Report says UPS plans to purchase additional natural-gas powered trucks

UPS intends to buy an additional 285 natural-gas powered trucks in 2014, which will cover every new heavy-duty vehicle purchased for its small-package delivery business, according to a Bloomberg News report.

In the report, UPS Chief Operating Officer David Abney said UPS looks at liquefied and compressed natural gas as a “bridge fuel” over the next decade, explaining that “[t]he economics drive it, the availability of the fuel drives it. When you look at the overall number for the domestic small package business, we’re not going to be buying any conventional tractors next year.”

The addition of 285 natural-gas powered trucks next year follows an announcement UPS made in April in which the company said it plans to purchase roughly 700 liquefied natural gas (LNG) vehicles and build four refueling stations by the end of next year.

The company said in April that UPS said that when these efforts are completed UPS will have one of the most extensive LNG private fleets in the United States.

Its new LNG refueling stations will be located in Knoxville, Nashville, and Memphis, Tenn., with the fourth one in Dallas, Texas. UPS said these stations will serve its heavy-weight rigs traveling into adjacent states, and it added that the company will also add LNG trucks on routes from Dallas, Houston, and San Antonio.

The Bloomberg report quoted Abney as saying the natural-gas truck purchases are part of UPS’s environmental sustainability effort, with UPS committed to reduce diesel soot emissions by 75 percent by 2020 and smog-forming nitrogen oxides by 60 percent.

What’s more, the report highlighted how UPS’s alternative fuel trucks have traveled 300 million miles since 2001 and have a goal of hitting 1 billion by 2017, with Abney explaining that through better information, route planning, and telematics UPS trucks drove 364 million fewer miles between 2001 and 2012.

UPS spokesman Andy McGowan said in the report that UPS has 1,016 CNG-powered package cars and 112 LNG-fueled tractors in the U.S., and it now operates 2,723 alternative-fuel and alternative-technology vehicles, with the additional 285 natural-gas powered tractors and nine fueling stations coming in at a cumulative investment of $75 million. 

A noted green transportation expert recently told LM that what UPS is doing in terms of LNG-related transportation efforts is highly impressive.

“UPS considers [itself] to be a leader in testing and investing in LNG for transportation,” said Brittain Ladd, a global supply chain consultant. “What UPS has been able to do is convey to corporations that have fleets of similar size and that operate in a similar environment that LNG is not only a viable source of fuel, LNG is becoming good business. As with all trends in business, especially trends that require capital investment and a paradigm shift, LNG has been slowly embraced by a few leading corporations.”

However, said Ladd, this move by UPS reinforces that LNG is worth the investment and for the companies that integrate LNG into their fleets, over the coming months and years they will reap the benefits of being an early adopter of LNG.
“Slowly but surely momentum for LNG continues to increase and it is only a matter of time before trucking fleets and the railroads put as much emphasis on the use of LNG as a fuel as UPS,” he said.