The New York Times

September 26, 2004, Sunday Late Edition - Final

Section 12 Page 1 Column 1 Desk: Automobiles Length: 1686 words

Ford Parks Its Natural Gas Bandwagon



AFTER a decade spent preaching the gospel of clean-burning naturalgas and winning converts among air-quality regulators and vehiclefleet operators, Ford is leaving the congregation.

The company produced its final natural gas vehicles last month.Once those cars and trucks are delivered to customers, Ford says itwill turn its full attention to the development of other types ofgreen cars, including those that would run on hydrogen fuel cells.But existing customers and natural gas proponents say the move willhave serious consequences, since Ford was the sole supplier ofseveral types of vehicles.

Cars and trucks that run on compressed natural gas, or C.N.G.,have distinct environmental benefits compared with gasoline or dieselvehicles. The combustion produces fewer greenhouse gases, less sootand lower smog-causing emissions. The differences are so significantthat a number of state and local governments, as well ascorporations, have added C.N.G. vehicles to their fleets.

And in contrast with crude oil, natural gas is a domestic energysource; nearly all of what is consumed in the United States isproduced in North America.

Before Ford announced its withdrawal from the market, in January,interest in natural gas vehicles had seemed to be growing. Next year,Honda will offer a home-fueling device for its lone natural gasautomobile, the Civic GX, which the American Council for an EnergyEfficient Economy has rated the world's greenest car. Ford of Europeis preparing to put natural gas versions of the Ford Focus and VolvoS40 on the road. And increasingly, municipal buses and garbage trucksare running on natural gas.

In the United States, Ford has been the leader in natural gasvehicles, having produced nearly 30,000 since 1997. Its models --including the Crown Victoria sedan, F-150 pickup and Econoline vans-- are used by taxi companies, municipalities, police forces andutilities.

Thus, Ford's decision to pull out of the market has left manygreen-fleet vehicle operators and planners in the lurch. It hasdisappointed natural gas proponents, who say it is environmentallyshort-sighted and a blow against energy self-sufficiency.

''What gets me is that Ford made a lot about being anenvironmental company,'' said Andrew Littlefair, president of CleanEnergy, the leading distributor of natural gas for vehicles. ''Thenthe same month that they decided to shut down the natural gas vehicledeal, they decided to produce the Excursion for another year.'' TheExcursion, the nation's largest mass-market S.U.V., is a particulartarget of environmentalists.

Last weekend, at a San Antonio meeting of the Natural Gas VehicleCoalition, a group of equipment manufacturers, suppliers andlobbyists, many of the delegates conceded that there was littlechance of persuading Ford to reverse itself. Some held out hope thatthe automaker might at least certify other companies to convert itsvehicles.

But David Henry, business strategy manager for Ford's alternativefuel vehicle program, said the automaker was unlikely to license anyaftermarket company to do the $5,000 to $8,000 conversions in thenear future. He said Ford would continue to cover its own natural gascars under warranty, but if a car converted by another company had aproblem caused by the conversion, that specific repair would not becovered.

Ford's decision to stop making natural gas vehicles is ''a hugedeal,'' said Mike Eaves, president of the California Natural GasVehicle Coalition, adding, ''The taxi market wants a big four-doorsedan with rear-wheel drive, and the Crown Victoria is the only onein North America.''

Jim Harger, senior vice president of Clean Energy, noted thatCrown Victoria taxis were in use around airports at Los Angeles,Phoenix, Seattle and San Francisco, among others. ''Ford's reluctanceto continue the C.N.G. Crown Victoria will negatively impactclean-fleet policies at these airports,'' he said.

Mr. Henry of Ford said that while the company's natural gasvehicles were profitable, they were not selling well enough tojustify the program.

In addition, he said Ford wanted to shift its engineers andresources to combined gas-electric vehicles like its new EscapeHybrid, to cleaner-burning gasoline technology like its very clean''partial zero emissions'' Focus and to fuel-cell vehicles.

''Although we led the market in C.N.G.,'' Mr. Henry said, ''thetotal volume compared to our other product lines was very minimal.''

Of the estimated 130,000 natural gas vehicles on American roads,some 20,000 are in California -- including about 5,000 in the handsof individuals -- where they can refuel at more than 200 stations.The vehicles are legal in the state's high-occupancy lanes, evenwithout passengers.

In New York City, some 6,000 natural gas fleet vehicles, many ofthem operated by Consolidated Edison or by city agencies, can useabout 20 fueling stations. Natural gas is also used in city transitfleets in Atlanta, Washington, Boston, Cleveland and Phoenix, and bymany utilities.

Compared with gasoline, combustion of natural gas in cars produces70 percent less carbon monoxide and 87 percent less nitrogen oxide.According to the Union of Concerned Scientists, an environmentaladvocacy group, the most affordable shuttle vans and school buses areoften diesel-fueled. The cleanest of these produce five times thesoot and twice the smog-forming compounds of comparable natural-gasvehicles.

Diesel combustion also produces some 40 toxic air contaminants,while natural gas combustion is safe enough for heating and cookingin millions of homes. Natural gas vehicles produce about 20 percentless emissions of the greenhouse gases that cause global warming,principally carbon dioxide, than comparable petroleum-fueledvehicles.

This figure is quite significant, Mr. Harger said, because airresources boards in California, New York and New Jersey areconsidering whether to require automakers to reduce greenhouse gasesby as much as 30 percent in coming decades. Natural gas vehiclescould help considerably in meeting such a standard.

''People ask us why we are fooling with this technology,'' saidMr. Littlefair of Clean Energy, ''Well, you have 7,000 C.N.G. trashtrucks in Southern California. That's like taking two millionvehicles off the road.''

Compared with gasoline and diesel, natural gas customers payaround 20 percent less per gallon, but the operating cost iscomparable because the mileage of C.N.G. vehicles is about 20 percentlower.

Automotive C.N.G. tanks have a good safety record, but theirsmaller capacity generally means that the vehicles cannot travel asfar without refueling as a gasoline or diesel car can go. And thoughnatural gas costs less per gallon today, demand is rising even assafety and environmental concerns raise potential hurdles to newwells, import terminals and storage facilities.

Ford was one of the first companies to offer natural gas vehicles.In 1984, the automaker delivered 27 modified Ranger pickups to NorthAmerican utilities. The company invested in fueling infrastructureand expanded to a full line of natural gas cars, light trucks andmedium-duty trucks, including a ''bi-fuel'' F-150 pickup that runs oneither gasoline or natural gas. The C.N.G. Crown Victoria is the onlyfull-size car powered by natural gas.

Chrysler produced a few C.N.G. minivans and a shuttle in the early1990's, and General Motors stepped in with a limited line thatincluded full-size pickups and a van, which has since beendiscontinued.

In 1993, Honda introduced its Civic GX, and the bulk of its saleshave been to fleet operators, including New York City. Early nextyear, Honda plans to step up its GX marketing while offering itsFuelMaker home-fueling system. By tapping into residential gas lines,FuelMaker can be used with any C.N.G. vehicle, not just Hondas.

Until then, refueling typically involves taking the vehicle to adedicated filling station with high-pressure hoses that attach tospecial fittings on the vehicle. Fueling is not considered dangerous,but filling stations remain sparse.

This is one reason Ford pulled out, Mr. Henry said. ''Despite ourbest efforts, one of the things that was a real inhibitor was a lackof infrastructure,'' he said. ''It was our customers telling us thatit was just too inconvenient, and not knowing where the next fuelingpoint was.''

Mr. Henry also said that the company had other demands on itsresources. ''It's no secret that Ford is going through arevitalization plan,'' he said. ''We had to focus on rebuilding ourproduct lineup.''

Mr. Henry said that if hybrid vehicles sold well, their volumewould reduce oil imports by more than a relatively small number ofC.N.G. vehicles. He added that while Ford would keep an eye onHonda's fuel-at-home system, the future eventually belongs tohydrogen and fuel cells.

Mr. Littlefair said he wondered how that future would arrive ifFord never took further steps away from gasoline cars. ''I think alot of this is public posturing,'' he said. ''In California, you'vegot natural gas pipelines running up and down every street. Inpopulated areas, it's everywhere. It's a day at the beach comparedwith creating an infrastructure with hydrogen.''

Mr. Eaves of the California natural gas coalition expressedfrustration that a vehicle technology financed in part throughutilities in that state, and thus its customers, was now headingoverseas.

''The Focus showing up in Europe is kind of a slap in the face ofthe U.S.,'' he said. ''A lot of California rate payers helped financeFord's N.G.V. development program. Now they're pulling out and usingthat expertise somewhere else.''

Images: Photos: Ali Barkesseh refuels a Ford E-350 shuttle buswith natural gas in Santa Ana, Calif.; To refuel, high-pressure hoseattaches to special fittings on natural gas vehicles. (Photographs byJamie Rector for The New York Times)(pg. 1); Jim Harger, a CleanEnergy executive, at a natural gas filling station. (Photo by JamieRector for The New York Times)(pg. 4)