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Peregrine Fuel Saving Strategy

In: Business and Management

Submitted By kadeethompson
Words 1697
Pages 7
In reaction to cost minimization and profit maximization the business world has begun reengineering the business process. Energy sources that are scarce are being consumed by the transportation industry. The Peregrine Trucking Company is developing a strategic plan to reduce the fuel cost and by using various trucking equipment’s that are more efficient and socially conscious while creating a competitive advantage. This study is to help understand the importance of reducing the fuel costs for Peregrine Trucking Company. This highlighted outline also discusses various tools, equipment’s and methods to reduce the fuel expenses of the company. This discussion targets the business processes in the transportation industry to reduce the fuel cost incurred for trucks with special reference to the Peregrine Trucking Company. Over the last two decades the transportation industry became highly competitive. Freight transport demand has grown rapidly and will grow further as our economies recover from the current economic instability. This puts pressure on the capacity of transport networks and community acceptance of the environmental and safety impacts of freight transport, especially by the trucking industry. Alternative cost and energy saving methods need to be identified by the transportation industry to reduce not just the fuel cost but reduce the environmental impact the transportation industry has in the country. The IEA, according to the Aluminum Association (2008), forecasts that annual car and light truck sales worldwide will grow from approximately 65 million in 2006 to more than 140 million in 2050. The technology is supporting the transportation industry with improved fuel efficient equipment, and alternative energy sources to reduce the fuel cost. Fuel consumption expense is a direct cost incurred in the Peregrine Transportation Company. Therefore Peregrine Trucking Company has considerations of alternative equipment and energy sources to reduce that fuel cost. The decline of fuel costs is indirectly related to profit maximization, as the fuel cost decreases the profit increases. The

Peregrine Trucking Company can attain competitive advantage by reducing the fuel cost. The following technologically savvy equipment is designed to save fuel and reduce greenhouse gas emissions as a part of strategic transportation planning. The use and implementation of each listed method also allows for an opportunity to become socially conscious while benefitting not only the company but the stakeholders as well. The trucks should utilize turbocharger engines because turbo engines consume less fuel. The heat produced by the engine during operation is then converted into energy source for the engine. In allowing for turbocharged engines the company will save fuel costs thus creating a positive impact on the company and society as well. Beginning in the 1990s, as stated by Gereffi, Dubay, (2008), the turbocharging technology was introduced to the automobile industry. The power-to-weight ratio, i.e. kilowatt (power output)/kilograms (engine weight), of the exhaust gas turbocharged engine, according to BorgWarner (2012), is much better than that of the naturally aspirated engine. The CO2 emission of the turbo engine truck is also low which can reduce the greenhouse gas emission. The technologically advanced trucks comprised with turbocharged engines will save fuel and will also environmentally friendly. Speed limits must be kept fixed while the truck is operating on the highway. This will reduce the fuel consumption and save money. There is also the concept, creating a certain amount of controversy that suggests reducing speed will reduce accidents and would create a social advantage. The mileage of the trucks increases per unit if the vehicle is restricted to top speed of 55mph. Above 55, according to Cummins, (2007), each 1 mph increased in speed decreases fuel economy by 0.1 mpg. Introducing speed limits for the trucks on highways cuts the fuel costs and pollutant emissions. Electronic speed limiters need to be fixed in the trucks to govern the speed. The drivers need to be trained and motivated to drive the truck within a given

speed limit to save and reduce fuel usage and contribute to the profits of the company. The low rolling resistance tires is one of the factor contributes for low fuel cost. The trucks with such low rolling resistance tires consume low fuel. As each tire on a vehicle rolls down the road, it creates a drag force which creates more energy expended to operate the truck. It is composed of the energy loss created by the deflection of the tire sidewall and the compression and deformation of the tire tread in the footprint at the road surface. This drag force is called rolling resistance. Such resistance of the tires can be reduced with low rolling resistance tires. The low rolling resistance tires have less contact patch with the road. The trucks with such tires accelerates smoothly and consumers less fuel. The Peregrine Trucking Company can use low rolling resistance tires for savings on their fuel consumption and cost. As stated by Environmental Defense Fund, the Transportation Research Board announced that reducing the average rolling resistance of tires 10% can equate to a 1 to 2% increase in fuel economy. In addition there are other suggestions for fuel reduction in terms of proper tires which are as follows:
• Tires should be fully inflated. For every 10 PSI that a truck has underinflated tires there is a 1% reduction in fuel economy.
• Ribbed tires, on the axles, give 2-4% improvement in fuel economy over lugged tires.
Tires, also according to Cummins (2008), make the greatest amount of difference in MPG below 50 mph. Auxiliary Power units need to be installed in the trucks of the Peregrine Trucking Company. The auxiliary power units reduce carbon emissions by eliminating the idling times of a transportation vehicle. Every hour of idling time, in a long-haul operation, will decrease the fuel economy of the truck by 1%, as stated by Cummins (2007). The auxiliary power unit (APU)

offers truck drivers on a long-haul the luxury of air conditioning during driving breaks while eliminating the need to idle the engine. As an example, according to Gereffi, Dubay (2008), during 2005 Wal-Mart, with the second largest fleet in the nation, introduced a goal of doubling the efficiency of its trucking fleet by 2015 according to Gereffi and Dubay (2009). Increasing fleet efficiency to this level will prevent 13 million tons of carbon dioxide emissions. One of Wal-Mart’s first steps towards this goal was to purchase and install 7,000 APUs in its long-haul trucks. The company has estimated APUs save $25 million in annual fuel costs, a figure that has likely increased with higher global oil prices in recent years. Lowering the weight of each vehicle will reduce fuel consumption. The body parts of the truck like diesel tank, toolbox, and battery box should be made of aluminum. The weight of the truck is directly proportional to the fuel consumption. If the trucks body parts are made of low weight metals like aluminum the truck consumes less fuel. The Peregrine Trucking Company can save the fuel cost in the long run if body parts are made of aluminum. The Aluminum Association’s Transportation Group (ATG), according to IAI, (2008) said in a study about the benefits of aluminum, and combined with other data there is a total of about 525 pounds of additional weight savings which could result in 2.7 more miles per gallon or almost a 10% further improvement in fuel economy over a typical day. Every body part of the truck should be considered for change to reduce fuel consumption. The aluminum cab construction of the truck would reduce the weight of the truck thus reducing fuel consumption. The tire rims should also be low weight metals but the strength of the metal should not be compromised. If most of the body parts are made of aluminum the weight of the vehicle of decreases drastically. Peregrine
Trucking Company should utilize the aluminum body trucks to save the fuel costs. Initially the cost incurred to purchase the vehicle with aluminum body is more but the fuel cost can be saved

in the length and amount of operation time for each truck. The wind resistance is another major contribution for consumption of fuel for trucks. The more there is wind resistance the more fuel is consumed thus increasing Peregrine Trucking Company’s expenditures. Noted by Cummins (2008), for every 2% reduction in aerodynamic drag there will be almost 1% improvement in the trucks fuel economy. Also stated by Cummins (2008), aerodynamics is the most important factor in MPG when a truck is operating over 50 mph. Peregrine would benefit from aerodynamically designed trucks. The fleets wind resistance can be reduced by the following techniques like:
· Aerodynamic Bumper
· Aerodynamic Hood
· Aerodynamic Mirrors
· Full Roof Fairing
· Center Chassis Fairings etc.
The trucks of the company can be modified using the aerodynamic technology for low fuel consumption. There is a tremendous need for the transportation industry to follow practices for reducing fuel costs. The organizations in the industry can achieve a competitive advantage by altering their practices and utilizing the latest technologies to reduce the fuel cost. The low consumption of fuel allows the industry to be socially and environmentally conscience. The Peregrine Trucking Company can upgrade their vehicles to include turbocharged engines, aerodynamic body style aluminum body parts, low rolling resistance tires and auxiliary power units for saving the fuel costs of the company.

References

Cummins MPG Guide, (Feb. 2007). Secrets of Better Fuel Economy. Cummins MPG Guide. Retrieved from

https://docs.google.com/viewer?a=v&q=cache:6frJHXdI1vYJ:www.nptc.org/index.php%3Foption%3Dcom_

Fraser Basin. (June, 2008). enviroTruck: The Cleaner, Greener Transportation Choice. Backgounder.

Retrieved from http://www.fraserbasin.bc.ca/news/documents/BG_enviroTruck_June_26_2008.pdf

Gary Gereffi, Kristen Dubay, (2009) Manufacturing Climate Solutions: Carbon-Reducing Technologies and U.S. Jobs, Duke University, Durham, NC: Center on Globalization, Governance & Competitiveness Retrieved from http://www.cggc.duke.edu/environment/climatesolutions/greeneconomy_Ch3_AuxiliaryPowerUnits.pdf

Environmental Defense Fund. Greenhouse Gas Management for Medium-Duty Truck Fleets A Framework for Improving Efficiency and Reducing Emissions. EDF. Retrieved from http://business.edf.org/sites/business.edf.org/files/ghg-management-medium-duty.pdf

International Aluminum Institute, (2008). Transport and Aluminum. IAI. Retrieved from http://www.world-aluminium.org/media/filer/2012/06/12/fl0000172.pdf

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