Where you see Navistar in "Despair", another writer sees Navistar meeting and beating its competitors:

http://www.glgroup.com/News/The-Mini-Truck-Prebuy-Is-Here---Some-Truckers-Restocking-Their-Own-Shelves-A-Bit-43118.html

New EPA Rule Could Disrupt Navistar Engine Plan

(CNN Money) A new federal regulation could keep Navistar from offering customers 15-liter Cummins engines for the company's heavy trucks next year.

The pending rule on stockpiling engines from the U.S. EPA raises the potential for Navistar to be left without a 15-liter engine option until 2011. That would trigger a drop in the company's second-place share of the North American heavy truck market since an estimated 60% of its heavy-duty trucks are sold with 15-liter engines.

Only the 15-liter engines would be affected in this case because the new rule could prevent Navistar from stockpiling that size engine from Cummins Inc. while Navistar completes work on its own 15-liter engine (with joint-venture partner Caterpillar). Navistar manufactures other engine sizes for its trucks.

Navistar maintains it will be able to provide 15-liter engines next year to customers who want them and said the EPA has signed off on its engine-supply strategy.

Navistar plans to rely on 15-liter engines built this year by Cummins until a 15-liter engine being developed by Navistar and Caterpillar is ready for sale near the end of 2010. Navistar expects to purchase enough Cummins engines by the end of the year to cover its anticipated demand for 15-liter engines in 2010.

Navistar won't be able to offer customers the 2010 version of Cummins' 15-liter engine because it will have an SCR emissions-reduction system that's incompatible with Navistar's trucks which are set-up for EGR. Navistar's rivals - Freightliner, Paccar and Volvo - are all using SCR like Cummins.

The threat of losing access to 15-liter engines next year caused J.P. Morgan on Thursday to lower its rating on Navistar's stock to "neutral" from " overweight."

Other industry analysts, however, said the rule poses little risk to Navistar's use of 2009 engines as a stopgap solution.

The EPA would "have to prove you're intentionally doing it to avoid the new emissions standards, and that would be hard to prove," said Brian Rayle, an analyst with Northcoast Research in Cleveland.

The EPA wants to restrict 2009 engine production to 2009 truck orders by prohibiting truck makers from stockpiling lower-cost engines this year.

"An engine manufacturer cannot sell engines in a current model year for the purpose of having them installed in a future model year's vehicles ... when the number of such engines exceeds normal inventory requirements," the EPA said in an explanation that accompanied the release of the rule last month. Final adoption of the measure is expected by the middle of December.

Navistar Chairman and Chief Executive Daniel Ustian on Thursday said the company's engine plans have been vetted by the EPA.

"They're well aware of what we're doing," Ustian said in a conference call with Wall Street analysts. "Our transition engine build is consistent with what the EPA has outlined in the rule making."

A spokeswoman for the EPA declined to comment on how the proposal would affect Navistar.

The company is already at odds with the agency over its guidelines for complying with the 2010 emissions standards. Navistar has accused the EPA of disregarding its own procedures in certifying SCR, which douses diesel exhaust with a mixture of urea and water to reduce nitrogen oxide emissions. Navistar is the only truck maker in North America not deploying the system. It's using EGR technology that recirculates diesel exhaust through its engines. Navistar's objections are pending in the U.S. Court of Appeals.

Navistar CEO Peppered With Questions About Truck Engines

CHICAGO -(Dow Jones)- Navistar expects to convince some of its customers next year to try smaller engines in their heavy-duty trucks to compensate for the company's precarious supply of 15-liter engines.

Investors peppered Chief Executive Daniel Ustian with questions Tuesday in the wake of a proposed federal regulation that could block the company's plan to buy enough 15-liter engines from Cummins by the end of 2009 to cover next year's demand while Navistar completes work on its own 15-liter engine. About 60% of Navistar's heavy-duty trucks are purchased with 15-liter engines.

"We believe that [15-liter] market can transition to a 13-liter engine," said Ustian. "If the product does the job, the customer will want a 13-liter" engine.

But Navistar's own 13-liter MaxxForce engine (MAN D26) is new to the North American market and remains largely untested under high-mileage conditions with commercial trucking companies. Ustian played down the risks for Navistar to lose market share next year if it isn't able to provide customers with the engines they're used to buying. Navistar has a second-place share of the market for heavy tractors.

"There's a potential for us to gain as many as we lose," Ustian said. Customers "are willing to convert if it does the job and has the durability."

The uncertainty over the performance and availability of Navistar's heavy-duty truck engines largely stems from the company's decision to deploy an emissions- reduction system that will not be compatible with engines built next year by Cummins, which has supplied most of Navistar's heavy-duty engines in the past.

A pending rule from the U.S. Environmental Protection Agency appears to limit Navistar's ability to stockpile a year's worth of 15-liter engines built in 2009 by Cummins. Stricter federal standards on nitrogen oxide pollution have forced engine builders to add elaborate systems for treating diesel-engine exhaust beginning next year. Those components have added several thousand dollars to the cost of 2010 diesel engines.

The EPA wants to restrict 2009 engine production to 2009 truck orders by prohibiting truck makers from stockpiling lower-cost engines this year. The rule is expected to take effect by the middle of December.

Despite the rule, Ustian maintained the EPA has already sanctioned Navistar's supply strategy with Cummins. He also flatly rejected suggestions that Navistar adopt the same emissions-reduction system as Cummins to allow Navistar to use Cummins' 2010 engines.

"Our products are running," he said. "Why would we want to invest in some other technology?"

http://fleetowner.com/management/news/navistar-scr-viable-technology/

What exactly is Navistar trying to do with comments like these?

Very interesting indeed.
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Navistar calls SCR viable technology

(Fleet Owner) Before reaffirming Navistar's intention to be the sole U.S. truck manufacturer not to use selective catalytic reduction (SCR) to meet the upcoming 2010 diesel emissions requirements, Tim Shick, director of business & product strategy told an online audience that, we think SCR is a very viable technology. We can't find anything negative about it.

The company, which has filed a federal suit against the U.S. EPA over its rules approving SCR for 2010 emissions control, has instead chosen to use high levels of exhaust gas recirculation (EGR) to meet new NOx emissions limits because we wanted to minimize the customer's burden in 2010, Shick said during a web presentation hosted by the Truck Rental and Leasing Association that included all of the major heavy-duty truck and engine manufacturers.

Before turning to the specific attributes of what Navistar is calling advanced EGR, Shick added that the company would move to SCR if a non-liquid form of urea currently under development were ready for commercial application. We don't like liquid (AdBlue), and the non-liquid is not ready yet so we will run with EGR to reduce NOx, he said.

Addressing critics of Navistar's emissions approach, Shick said "We are ready for 2010 in spades". In particular, he said that development work on its common rail fuel system would restore regeneration cycles for its diesel particulate filters (DPFs) and oil-change intervals to 2007 levels. He added that its high-EGR engines would also have basically the same fuel economy as its 2007 engines.

The first of the SCR users to address the conference, Mike Breeden of Cummins Engine Co., said that SCR allows us to optimize engines for driveability, better torque response and quieter operation. Specifically, he pointed to fleets tests showing 5% or better MPG than our 2009 ISX heavy-duty diesel engine. The decrease in fuel consumption, however, is partially offset by AdBlue use, bringing the total fluid use reduction down to 3%, he noted.

Technical presentations from Mack Trucks, Volvo Trucks of North America and Detroit Diesel outlined other benefits and characteristics of the SCR approach for TRALA members. Cited were widespread use of SCR in Europe without significant technical problems, reduction or complete elimination of active DPF regeneration cycling, little modification of existing engine hardware or maintenance requirements, and higher horsepower outputs without displacement increases.