Fiat Looks to Market Natural Gas-Powered Vehicles in U.S.

Instead of competing with Nissan, GM, Ford and others for its share of the electric vehicle market in the U.S., Fiat plans to push its natural gas engine technology. In Europe, Fiat owns the lion’s share of the natural gas powered vehicle market.  Fiat and Chrysler Group LLC Chairman Sergio Marchionne says electric vehicles face “too many obstacles”, including the inconvenience of battery recharging, to be practical.

In Europe, Fiat’s methane powered passenger vehicles account for 80 percent of the market. The Italian automaker also controls 55 percent of the light commercial vehicle market.

Fiat’s head of transmission and hybrid vehicle development Constantinos Vafidis says, “Natural gas is very suitable for the U.S.  Especially for public services and goods transportation, where vehicles are refueled from a central base.” Bolstering that view is the fact that the U.S. is now the world’s largest producer of natural gas.

Despite its abundant reserves, the U.S. currently ranks 14th in the world in the sale of natural gas powered vehicles according to the International Association for Natural Gas Vehicles. The association ranks Pakistan, with approximately 2.3 million vehicles and 3,068 natural gas refueling stations, as the world’s largest market for the technology.

Milan Polytechnic University professor Giuliano Noci says, “Fiat will use its technological leadership in natural gas, in a region discovered to have huge reserves,” and adds, “It’s almost a mandatory strategy. Fiat should lead the natural gas car market as it’s far behind in the electric vehicle sector.”

According to the head of Fiat SpA’s Iveco commercial truck unit, Alfredo Altavilla, natural gas engines are more affordable than either diesel or electric hybrid engines. In an interview last September, Altavilla said diesel engines cost an average $3,300 more than gasoline engines. The average additional cost of electric hybrid engines is $8,000. Natural gas engines, however, cost an additional $3,000 on average compared with gasoline engines.

Helped in part by government incentives, Fiat sold 127,000 methane-powered vehicles in Europe in 2009. In the U.S., GM has begun selling natural gas-powered vehicles to fleet buyers. Honda Motor Company is currently the only automaker selling natural gas-powered passenger vehicles to retail customers in the market.

Director of Fiat Powertrain Lucio Bernard said Fiat has already discussed the possibility of introducing its natural gas vehicle technology with U.S. and Canadian government officials. He said they became more receptive to the idea “after the recent discoveries of shale-gas reserves in the region.”

Chrysler spokesman Vince Muniga says, “We’re always looking at alternative propulsion systems and how to reduce our dependency on foreign oil, so [natural gas] is one thing we are looking at.”

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