Advanced Powertrain Technologies and the North American Locomotive Market

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Advanced Powertrain Technologies and the North American Locomotive Market

  1. 1. Advanced Powertrain Technologies Expected toSteam Up the North American Locomotive Market Surendar Chandrasekaran, Research Analyst Automotive & Transportation 26th May 2010
  2. 2. Today’s Presenter: Surendar Chandrasekaran Functional Expertise • Three years of experience in research and analytics, which include market analysis across industries with particular focus on the automotive and transportation domain. Particular expertise in: - Market mapping, sizing and forecasts Place photo - Market entry strategy here - Technology analysis Shadow Background for Industry Expertise Experience base covering a broad range of sectors in the automotive & transportation domain: effect - European & American rail OEMs - Rail infrastructure providers (track, electrification, signaling) - Seating and interior solutions What I Bring to the Team Surendar Strong understanding of the diversified business segments within the rail industry Chandrasekaran Creative representation of complex information methodologies Senior Research Long-standing working relationships with leading industry participants’ Senior Executives Analyst Career Highlights Frost & Sullivan Extensive expertise in European urban and high-speed passenger rail sectors South Asia Worked with several leading firms and associations including: Chennai, India - Euro Copper Institute - Lockheed Martin - Bombardier Education • Executive Diploma in Financial Management, Madras University, Chennai • Masters of International Business, Monash University, Melbourne, Australia • Bachelors in Engineering (Computer Science), Bharatiyar University, Coimbatore, India 2
  3. 3. Focus PointsGlobal Trends and The Rail AdvantageIntroduction to the North American Locomotive MarketA Goal Post Analysis on the Locomotive Powertrain MarketEPA Emissions and ChallengesIn-Powertrain Technologies for Emission ReductionPenetration Analysis of Powertrain TechnologiesAnalysis on Effectiveness of Powertrain Technologies in NOX ReductionIdle Reduction TechnologiesHybrid Locomotive Concepts and Penetration AnalysisLocomotive Powertrain Technology RoadmapKey FindingsNext StepsFor Additional Information 3
  4. 4. Mega Corridors in 2050: Global Snapshot of Future Mega Corridors Connecting Two Or MoreLarge Cities or Mega Regions and Characterised by High Levels of Industrialisation/Urbanisation– A Major Potential for Rail Freight and Passenger Services Evolution of Megacities: Mega Corridors (Global), 2050 Trans European Transport Network (TEN-T) serving entire Europe Tokyo- Osaka Great Lakes Corridor: Home to 90 Corridor Million People Front Range North East Hong Kong- Cascadia Corridor Corridor Shenzhen- (BOSWASH) Guangzhou Corridor: Home to g/pkm Abu Dhabi - 120 Million People Northern and Piedmont Dubai Southern Atlantic California Ibadan-Lagos-Accra g/km Corridor Florida Urban Corridor: 600 The Texas Corridor Kilometers Arizona Sun Triangle Corridor São Paulo to Rio de Janeiro Corridor: Home to 50+ Million People Mumbai – Pune, Chennai – Bangalore, Delhi – Chandigarh and many others Note: All figures are rounded; the base year is 2010. Source: Frost & Sullivan 4
  5. 5. While rail’s green tag is driving investments and its popularity, recovering rail freight volumes are reassuring rail’s viability financially. CO2 Emission Advantage Of Rails NOX VS PM contributions by Mobile Source (North America), 2010 NOX Contribution PM Contribution Locomotiv e Locomotiv e Truck 60 g/tkm 19% 32%Freight Frieght Rail 23 g/tkm Marine High Way 16% Marine 32% 34% Vessel 20 g/tkm High Way Air 205 g/pkm Other Non 13% Other Non Road 31% Road 23%Passenger Bus 160 g/pkm Car 140 g/kmLight Rail/Metro 85.5 g/pkm • Rail is the lowest contributor to Co2 emissions and hence the huge government support. Inter-City Rail 65 g/pkm • Though locomotives are substantially more efficient than road vehicles in terms of per freight ton or passenger mile High Speed 2.2 g/pkm moved, they still contribute to a major part of PM and NOX emissions. Source: Alstom Transport, EcoTransIT, carbonneutralcalculator g/pkm – grams per passenger kilometer g/tkm- grams per ton kilometer 5
  6. 6. The North American Locomotive Market is Dominated by Diesel Freight Locomotives Locomotive Market: Share by Segment (North America), Locomotive Market: Share by Fuel Type (North America), 2010 2010 Frieght Freight is the biggest locomotive market Di esel 75% segment in North America and is completely powered by diesel. 99.4% 21% 4% 0.6% El ect r i c Passenger Switchers Locomotive Market: Average Fleet Age of Freight Locomotive Market: Locomotive Average Fleet Age by Locomotives Owned by Railroads (North America), 2010 Passenger and Freight Segment (North America), 2010 Largest fleet owners have relatively younger locomotive fleet. Locomotive Age 30 Passenger locomotives are older as a 10000 25 result of commuter railroads buying aged fleet from freight railroads.Units owned 8000 20 20. 9 Age 6000 15 Age 20 17. 6 4000 10 2000 5 0 0 10 PR F P SX S ax N S k S U tra Fr i eght Passenger KC C N m C C BN Am rro Fe Note: All figures are rounded; the base year is 2010. Source: Frost & Sullivan M64A-18 6 6
  7. 7. New Locomotive Powertrain Requirement: About 5,600 New Powertrains isExpected to go into 4,513 New Locomotives Locomotive Market: Total Locomotive Requirement (North America), 2010 and 2017 Electric Passenger 36,500 31,987 1.37% 0.63% Electric Passenger 4.86% 3.67% Diesel passenger Diesel Switcher passenger Switcher 20.66% Total New Locomotive Powertrain Requirement by Country between 2010 19.58% and 2017 USA Canada MexicoLocomotives Parked Locomotives Parked 277 Line Haul Line Haul Freight 333 Freight 75.03% 2472 74.20% 131 Mexico Canada 157 44 88 Canada 1169 67 472 230 2010 (1,000<hp<2,500) (3,500<hp<4,500) (3,500<hp<4,500) (7,000<hp<8,000) 2017 Switcher/Regional Line Haul Freight Passenger Passenger Freight Application Diesel Electric Application Application Application Note: All figures are rounded; the base year is 2010. Source: Frost & Sullivan • Increased share of passenger locomotive fleet is a result of efforts to revive passenger rail transportation. • The requirement of 536 new switcher locomotives is expected to create an opportunity for about 1,458 medium horsepower powertrains; this presents a good opportunity for non-road engine manufacturers. 7
  8. 8. Comparison of PM and NOX Reduction Analysis for Locomotives ofDifferent Tiers Locomotive Market: PM Vs NOX Emission Reduction Plan (North America) 2010 - 2017 Line Haul & Passenger Locomotive Emission 0.5 Tier 2 (VS) Tier 3 – Tier 4 – Reductions (%) Reductions (%) Tier 4 - Line haul & Switcher by using exhaust after-treatment Line Haul 50% PM 85% PM 0.4 0% NOX 76% NOX Switcher 23% PM 77% PMPM (g/hp-hr) Tier 2 - Line haul Tier 3 – Line haul by fine tuning 38% NOX 84% NOX (g/hp 0.3 in powertrain technology Non Road Engine Emissions Tier 3 (VS) Tier 4 – Reductions (%) 600<hp<=750 90% PM, 90% NOX 0.2 hp>750 85% PM, 90% NOX Tier 2 - Switcher 0.1 Tier 3 – Switcher (non road powertrains) 1 2 3 4 5 6 7 8 9 10 NOX (g/hp-hr) • Switcher locomotives have more stringent stage-by-stage emission cuts than line haul. There is 10 percent lower NOX levels in tier 3 compared to line haul locomotives. • Over 75 to 85 percent reduction in PM and NOX are required in the Tier 4 implementation period. Note: All figures are rounded; the base year is 2010. Source: Frost & Sullivan M64A-18 8
  9. 9. Key Industry Challenges for Locomotive Systems Locomotive Market: Key Market Challenges (North America), 2010 The cost of creating an infrastructure for alternative fuels 2015 norms require NOX and PM such as LNG, ethanol, or hydrogen has to be borne by emissions to reduce by 85 percent the respective railroads. This substantially increases the from present levels. Hence tier-2 overall cost of switching to alternative fuel locomotives. compliant technologies, which are by Meeting EPA tier 4 itself advanced, need further emission norms improvisation in a span of 5 years. Creation of Infrastructure for alternative fuels Market Challenges Only 2 Players catering to the largest segment for locomotives in NA EPA norms only account for powertrain exhaust emissions • The rail industry in the United Less R&D expenditure in States can source locomotives Locomotive technology only from OEMs and suppliers A locomotive emission can be controlled by a variety of that have 80% localization. additional technologies during operation. This restricts competition and increases the time to market However, EPA considers only direct exhaust new efficient locomotive emissions from powertrains and not auxiliary technologies from other parts technologies such as start stop, brake energy recovery, and so on that helps in emission reduction. of the world. Source: Frost & Sullivan 9
  10. 10. A Snapshot Diesel Powertrain Technologies in use and consideration forEmission Reduction and Energy Consumption Locomotive Market: Diesel Powertrain Technologies in Use and Consideration for Emission Reduction (North America), 2010 Clean engines using Advanced systems to manage Common rail injection + Microprocessor enables engine output and lubrication turbo charging software technologies for consumption technique - enables performance and fuel engine downsizing efficiency improvement – LFO, LEADER, GE’s trip Optimizer) PM + NOX reduction After Cooler techniques for 2015 Advanced Loco Systems Ignition Systems EPA Tier IV standards Reduce idling – Management control emissions Systems DPF + SCR Efficient Power Boost Technique AESS Exhaust Gas Recirculation DDHS/ HEP Brake Energy Recovery Energy On Demand & Auxiliary power Separate efficient gensets Battery Banks to power the railcars and Alternative Fuels the cabin Use of highly efficient smaller engines to charge battery banks that power the locomotives Less Polluting Fuels such as LNG Source: Frost & Sullivan M64A-18 10
  11. 11. Freight Locomotive Powertrain Technology Trends Locomotive Market: Freight Locomotive Technology Trends (North America), 2010-2017 Engine downsizing and turbo-charging; use of genset engines High-pressure common rail injection system to become standard Technology AC traction motors Trends preferred Exhaust after-treatment to be fitted in all modern locomotives Battery powered hybrid options are on testing Electric and Dual Mode grounds locomotives shall gain popularity Source: Frost & SullivanM64A-18 11 11
  12. 12. Commonrail, VGT to become a standard feature in locomotives by 2015. Locomotive Market: Penetration Forecast Of Powertrain Technologies (North America), 2010-2017 Key •Common rail injection systems shall have the quickest and highest penetration in powertrain Observations technologies of future locomotives. •SCR usage will be kept as a last option but shall be adopted by 99% of high hp line haul (3,500<hp<4,500) and by about 30% of medium hp locomotive powertrains (1,000<hp<2,500) 1200 120% 1200 120% 1087 1087 1000 100% 1000 100% Number of Locomotive UnitsNumber of Locomotive Units 800 758 80%800 758 80% % Penetration % Penetration % Penetration % Penetration 572 572 600 60%600 60% 474 452 474 430 443 443 452 430 377 377 400 40%400 40% 200 20%200 20% 0 0% 0 0% 2010 2011 2012 2013 2014 2015 2016 2017 2010 2011 2012 2013 2014 2015 2016 2017 Diesel Locomotives Common Rail Diesel Locomotives EGR DPF with DOC SCR Miller Valve Timing VGT FGT Advanced Air Cooling Note: All figures are rounded; the base year is 2010. Source: Frost & Sullivan M64A-18 12
  13. 13. Analysis: Powertrain Technologies and Their Implication on Emission Reduction – A Tier Based Model Forecast on NOX Reduction Locomotive Market: NOX Reduction by Technology Use for Powertrain Class 3,500<hp<4,500 Locomotives (North America), 2010-2015 • Common-rail injection, EGR and SCR are the primary technologies expected to be used by locomotive manufacturers to control NOX emissions from current tier 2 (5.5 g/bhp.hr) to tier 4 ( 1.3 g/bhp.hr) levels. 8 Pre 2005 2012: Tier 3 for locomotive emissions to become effective 7.4 Tier 3 does not require change in NOX levels. However, 7 use of common-rail injection by 2012 is expected to lower NOX levels to 3.3 g/bhp.hr. 6 2015: Tier 4 for locomotive emissions to become 2005 effective. 5.5 • Tier 4 NOX level of 1.3 g/bhp.hr is required. 5 • EGR helps bring NOX down from 3.3 g/bhp.hr tog/bhp.hr 2.1g/bhp.hr. • Further reduction to meet compliance is to be 4 done using SCR – takes NOX to 0.6 g/bhp.hr 2012 2015 3.3 3.3 3 2015 base year is 2010. Source: Frost & Note: All figures are rounded; the 2 2.1 2015 Sullivan 1 0.6 0 Electronic Pum p Turbo-charging & Com m on Rail DPF w ith DOC EGR SCR Injection Advanced Air Injection Cooler M64A-18 13
  14. 14. Performance Benchmarking of Idle Reduction Technologies Locomotive Market: Idle Reduction Technology Effectiveness – An Analysis (North America), 2010 Fuel Saving & Emission Total Segment compatibility Functional Limitation Reduction Potential 15 PointsAESS Low High High Low Low High 12.5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5DDHS/HEP Low High High Low Low High 14.5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5Electrical Shore Low High High Low Low High 6Power 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5Full hybrid (battery Low High High Low Low Highpowered) 12.0 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 Source: Frost & Sullivan Low High Key Observations Key : Measurement criteria & Definitions • DDHS/HEP score more than AESS as an effective idle reduction technology. • The possibility to use the technology is all locomotive segments Segment compatibility • However, taking cost and most – line haul, switcher and passenger prevalent weather conditions into • Higher the compatibility, higher the score consideration, EPA has only mandated AESS for locomotives from 2011. • HEP is mandatory in passenger • The Potential of the technology to function in required services locomotives Functional Limitation in all environmental conditions such as extremely cold/hot weather and when needed. • About 70 percent adoption of DDHS in freight locomotives. Source: Frost & Sullivan • Higher the limitation, lower the score and vice versa. M64A-18 14
  15. 15. Hybrid Powertrain – Brake Energy Recovery and Battery Powered Locomotives Hybrid locomotives have an alternative power source working in conjunction with or independent of a conventional diesel engine to power the locomotive’s traction motor. The alternative power source is typically a series of batteries that is charged either by braking or a small diesel engine. Types of Hybrids Micro Hybrid Mild Hybrid Full Hybrid Only Regenerative braking Regenerative braking + battery Batteries as Prime Mover for auxiliary power support power for acceleration support + downsized diesel engine Locomotive Market: Locomotive Powertrain Sales Forecast by Hybrid Technology Penetration (North America), 2010-2017 1400 • Micro Hybrids to make maximum penetration in the passenger segment. 1200Number of Locomotive Units • All electric passenger locomotives shall feature micro-hybrid regenerative braking technology. 1000 • Diesel passenger segment is expected to witness 40%-60% penetration of micro hybrid technology between 2010 and 2017. 800 600 400 200 0 2010 2011 Line Haul Freight 2012 2013 2014 Switcher/Regional 2015 2016 2017 Micro Hybrid Swithcer/Regional Locomotives Diesel Passenger Micro Hybrid Diesel Passenger Micro Hybrid Electric Passenger Mild Hybrid Freight Note: All figures are rounded; the base year is 2010. Source: Frost & Sullivan M64A-18 15
  16. 16. Technology Roadmap: Locomotive Engines will see Rapid Modernisation andImplementation of Technologies that Increase Efficiency and ReduceEmissions Technology Locomotive Market: Technology Roadmap (North America), 2010 Automatic Start Stop Systems Locomotive Auxiliary Power Systems Idle Reduction Systems Electric Shore Power Energy Regenerative Braking recovery Dynamic Braking Exhaust After Selective Catalytic Reduction Locomotive Engines Treatment Diesel Oxidation Catalyst and Diesel Particulate Filters Exhaust Gas Advanced Air to Air Coolers + Cooled EGR with Variable Utilization Intercoolers and Turbochargers Geometry Turbine Fuel Injection and Common Rail Injection and Miller Valve Timing HCCI Advanced Powertrains Combustion Electronic Fuel Injection Alternative Ethanol Fuel Locomotives Alternate Fuels Fuel Liquefied Natural Gas (LNG) Locomotives Source: Frost & Sullivan Diesel + a maximum of 20% BioDiesel Fuel Fuel Modifications Normal Diesel Fuel Clan Diesel Fuel With Sulphur < 15ppm Li-ion Battery Based Hybrid and Battery Hydrogen Fuel Cell Locomotives Hybrid Lead Acid Batteries Sodium Halide Mild Hybrid (Battery + Diesel Engine) 2005 2010 2015 2020 2025 16
  17. 17. Key Conclusions Locomotive Market: Key Conclusions (North America), 2010 Conclusions Emission regulators such as EPA are the primary driving force for Locomotive OEMs must inculcate change in locomotive continuous innovation as way forward powertrain technology. to sustainability and market leadership. Emission challenges Non-road powertrain suppliers must have fueled competition intensify competition by developing from non-road engine higher horsepower engines to cater to suppliers in the diesel line haul freight. freight locomotive segment. Line haul locomotive OEMs can consider partnering with leading non- road engine suppliers to strengthen powertrain technology offerings. Emissions apply only to OEMs must take advantage by diesel fuel locomotives developing and quickly and powertrains > 1,020 commercialising battery-powered hp. Fuel cell, ethanol or hybrids and ethanol fuel locomotives. electric locomotives to have little impact unless Strong industry lobbying by railroads robust supply chain and OEMs could make governments infrastructure is built with consider the ecological benefits of federal support. providing new infrastructure. Source: Frost & SullivanM64A-18 17 17
  18. 18. Growth Opportunities in Smart Mobility BusinessModels, Infrastructure and eService Platforms 15 June 2011 - Lords Terrace, House of Lords, Westminster, London, 16 June 2011 - Institute of Directors, 116 Pall Mall, Westminster, LondonFrost & Sullivan’s upcoming workshop will debate, discuss and Speakers include:provide recommendations to the industry on new Urban Mobility - Jan Cupal, Senior Technology Manager, Verbundmodels and how this trend can provide opportunities for - Dr. Bernhard Blättel, Director Project Mobility Services,government, public sector and corporations to align their future BMW AGmobility vision, products and services toward customers’ unmet - Robert Henrich, CEO, car2go GmbHneeds. - Andrew Everett, Head of Transport, Technology Strategy BoardHighlights of the event include: - Michael Hurwitz, Director, Office for Low Emission Vehicles• Panel debate at the House of Lords followed by a motion on - Kulveer Ranger, Mayor of Londons Environment Adviser, whether the mega-cities of the future and personal transport Greater London Authority solutions will be as sustainable as public transport. This panel - Alexander Sixt, Head of Corporate Development, SIXT AG will include a unique mix of parliamentarians, industry and - Phil Dingle, Power Utilities and Networks Segment academic experts. Manager, Eaton’s Electrical Business (EMEA)• Unique thought leadership platform featuring senior Mobility - Klaus Dehnert, Director Sales & Marketing Vehicle Group, heads discussing their vision and strategy to enable next Europe, Middle East and Africa, Vehicle Group, Eaton generation of Mobility Services. These include: New Mobility Corporation Concepts, Mega City Vehicles, Role of IT in providing Smart - John Rushton, Global Business Development Leader, Mobility, Electric Mobility Market Status, Infrastructure and New Intelligent Transport Systems, IBM Mobility Business Models. - Alexander Sixt, Head of Corporate Development, SIXT AG• Unique cross industry insights from a selective group of key - Ian Allen, Manager Environmental Strategy & Ampera, individuals provide the ideal networking environment. General Motors Event Partners & Sponsors For more information about Urban Mobility 3.0, or for a full agenda, visit: http://www.gil-global.com/urbanmobility. Alternatively, contact Cyril Cromier on cyril.cromier@frost.com or dial: +33 1 42 81 22 44 18
  19. 19. Next Steps Request a proposal for Growth Partnership Services or Growth Consulting Services to support you and your team to accelerate the growth of your company. (enquiries@frost.com) Join us at our annual Growth, Innovation, and Leadership 2011: A Frost & Sullivan Global Congress on Corporate Growth (www.gil-global.com) Register for Frost & Sullivan’s Growth Opportunity Newsletter and keep abreast of innovative growth opportunities (www.frost.com/news) 19
  20. 20. Your Feedback is Important to Us What would you like to see from Frost & Sullivan?Growth Forecasts?Competitive Structure?Emerging Trends?Strategic Recommendations?Other? Please inform us by rating this presentation Frost & Sullivan’s Growth Consulting can assist with your growth strategies 20
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  22. 22. For Additional InformationKatja Feick Cyril CromierCorporate Communications Sales DirectorAutomotive & Transportation Automotive & Transportation Europe+49 (0) 69 7703343 +33 1 42 81 22 44katja.feick@frost.com cyril.cromier@frost.com Franck Leveque Vice President - Growth Consulting Automotive & Transportation Europe +49 (0)69 770 33 21 Bb: +49 (0)151 27 67 08 24 franck.leveque@frost.com 22

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