ATD Notebook: Engine Rivals

This story appears in the May 3 print edition of Transport Topics. Click here to subscribe today.

KISSIMMEE, Fla. — Mack Trucks CEO Dennis Slagle said he is reinvigorating his company and willing to take on any rival, and he promptly picked fights with Navistar Inc. and Transportation Secretary Ray LaHood.

“Dealers weren’t happy in 2008, and the bulldog may have been a little flabby, but Mack is back and the bulldog is ready for a fight,” Slagle said at the American Truck Dealers convention on April 24. He succeeded Paul Vikner as CEO in 2008.

Slagle said he was particularly pleased with the company’s selective catalytic reduction engines for 2010 and said they are the better choice than “massive EGR,” a reference to Navistar’s exhaust gas recirculation. A Navistar senior vice president in attendance excoriated Slagle and Mack, calling into question their commitment to the environment.

Slagle said that LaHood’s remarks on transportation infrastructure spending “makes my blood begin to boil.” In March, LaHood spoke about treating mass transit and bike paths more like motorized modes of transportation, so as to promote “livable communities” (3-29, p. 5; click here for previous story).

“These are absurd arguments, and it shows we need to get more involved in Washington,” Slagle said.

In addition to running Mack, Slagle is in charge of Volvo Trucks North America, the Volvo Powertrain engine plant in Hagerstown, Md., and, as of Jan. 1, 2011, Volvo AB’s North American operations of medium-duty manufacturer UD Trucks.

UD, which makes Class 5-7 vehicles, was formerly Nissan Diesel, which Volvo purchased in 2007.

Slagle also said Volvo AB is working on hybrid trucks and alternative fuels for both heavy- and medium-duty models.

In response to the Jan. 1 tightening of federal emissions regulations on diesel engines, most truck and engine makers are using SCR technology, with Navistar’s MaxxForce engines as the single heavy-duty exception. Navistar Senior Vice President James Hebe launched an energetic response after the Navistar brand meeting here.

“What he [Slagle] said is inconsistent with what the fleets found at TMC. It was not an indictment of EGR as a strategy but of its execution. It had nothing to do with fuel economy or the life of the engines,” Hebe said.

Mack engineers have said that, with the addition of SCR aftertreatment to reduce nitrogen oxides, they can use EGR at 2002-06 levels, or less than in 2007-09. SCR more than makes up the difference.

Hebe dismissed that argument, saying SCR does not always work and, therefore, the reduction in EGR “dirties the air. So the real question is, ‘What the hell is Mack doing to the environment?’ ”

Also at the ATD convention, W.M. “Rusty” Rush, CEO of Rush Enterprises, New Braunfels, Texas, spoke about his company’s growth from 1992 to the new truck sales boom year of 2006, when it hit the $2.4 billion mark in revenue as the nation’s largest and only publicly traded chain of truck dealerships. In 2009, with truck sales at a historic low, revenue fell back to $1.2 billion.

In an interview, Rush said California truck sales are improving, although because of port regulations rather than genuine economic growth, and that Texas and Oklahoma also are doing well.

He also said his parts and service business is improving as fleets repair idled trucks.

Rush said the company’s acquisition of the Lake City Cos. (4-5, p. 6), a group of International dealerships, has caused him to change some practices. Rush Enterprises grew to prominence as a Peterbilt Motors dealership, but Rush said his company now generates about 40% of all new U.S. Peterbilt sales.

Rush said he is building an information technology firewall within his company to keep Peterbilt and International details separate.

“They will be separate operating groups with separate business systems,” Rush said. “I put my reputation on the line with both manufacturers.”