A quiet year?... business good, not so good ... a technical lull ... what's with all this alternative stuff ... what happened to the EPA settlement?
In looking back over the last 12 months (June to June) in the industrial engine business in North America you kind of get mixed signals.
Business is still good, though with ag and some of the other off-highway markets, maybe not as good. However, the sub-125 hp business continues to be strong, mobile and stationary, and the gen-set markets have absolutely gone through the roof, in all sizes.
It also feels like it's been a quieter year for news. But when you make a list of all the products, technology and industry events of the last 12 months, much if which is detailed in the pages of the 20th Annual Engine Yearbook that follows, it's actually been anything but quiet.
We also seem to be in somewhat of a technical lull between different tiers of a variety of emissions standards worldwide. Engine development today is now largely driven by whatever the next applicable emission regulation will be. Look at what regulation is coming, back the timeline up about a year, and you have a pretty good idea when to look for new engine developments.
Even if there is somewhat of a lull right now, there were a number of significant new engine product launches over the last 12 months.
As an industry we are also collectively sorting out the alternatives to gasoline, diesel and gaseous engines. As it stands today, there is still no true viable alternative to diesel, gasoline or gas engines; Al Gore not withstanding. In fact, there's nothing really close.
Yet as Mike Brezonick reports elsewhere in this issue, there is a lot of money being spent (again) on looking at what else might be able to provide the power to turn a shaft and do all the things that industrial engines currently do. So while business is good and current engines continue to be improved to meet the legislative standards directly in front of them, there remains a lot of activity for alternatives to current industrial engines.
All-in-all, a year of mixed signals.
There is also a temptation to say that there has not been a single "big" story that has dominated industry discussions, ala Cat-Perkins in 1998. But there was. The settlement reached between the EPA and seven on-highway engine manufacturers last October was called historic, and it was. There was an $83.4 million civil penalty and a collective commitment, estimated to be over $1 billion, to bring the engines into compliance.
North American Diesel Engine Production
1996 1997 1998 1999
5.1-20 hp - - - -
21-50 hp 539 526 512 527
51-100 hp 62,670 65,116 70,760 74,539
101-300 hp 649,246 693,037 846,313 890,016
301-700 hp 186,823 222,280 244,871 252,654
701-200 hp 8029 8670 9376 10,773
2001+ hp 2301 2427 2430 2452
Diesel Total 909,608 992,056 1,174,262 1,230,961
[TABULAR DATA OMITTED]
It was major news for the on-highway business, with definite ramifications off-highway, and throughout the overall industrial engine markets. Thus the settlement was easily the biggest engine story of the last 12 months. However, it never really became a "hot" topic throughout the industry after the immediate announcement, and faded somewhat quickly from the general industry radar screen.
While the Engine Yearbook that follows has most of the details of what's happened over the last 12 months, here are a few of the highlights.
Torreon, Mexico, became the site of the first all-new diesel engine manufacturing facility in North America in a number of years. Motores John Deere represents a $100+ million investment for Deere & Co. and was built to manufacture the PowerTech 2.9, 4.5 and 6.8 L diesels (50 to 225 hp) for outside customers, Deere's new skid-steer loaders, as well as other Deere equipment. Capacity of the new facility, which will be at full production early next year, is expected to be 50,000 engines annually.
In what is now a seemingly annual affair, changes in corporate ownership among engine builders continues. The rumor mill remains hot over more such changes to come, and as we go to press Detroit Diesel Corp. and Daimler-Chrysler have been trading press releases over their respective ownership positions.
Over the last 12 months, Volvo has purchased a 10 percent share of Deutz, thus ensuring a supply of engines for its construction equipment, as well as some on-highway applications. Lombardini has been sold to Mark IV Industries and Wis-Con Total Power has signed a distribution agreement with MWM Motores in Brazil for the U.S. and Canadian markets.
Kubota Engine America Corp. (KEA) officially debuted in October after 13 years as the engine division of Kubota Tractor Corp. A new facility in Lincolnshire, Ill., is now open and all Kubota engine activity in North America is now under one roof. MENA, Mitsubishi Engine North America, the three-way venture between Mitsubishi Heavy Industries, Mitsubishi Motors and Mitsubishi Corp. also undertook a significant expansion of its North American engine program.
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