Clean Transportation

Portec Rail Products (PRPX) released  fourth quarter results on Thursday, comfortably beating analyst expectations.  The stock promptly dropped 18% to just below $5, continuing a two-week decline from around $7.50. I'm baffled.  Although the rail freight industry is a victim of falling oil prices (which means they lose market share to trucking) and the overall drop-off of the transportation industry, this is not news. Portec has several things going for it.  The company has a strong balance sheet, with current assets exceeding total liabilities, and strong cash flow from operations.  Total revenue is down slightly from last...

Bottom line: Traditional car makers will suffer from weak sales growth and plunging margins in China in 2015 and into 2016, while EV makers will start the new year slow but could see improvement by the end of 2015. A flurry of headlines this week are sending ominous signals for the car industry in the year ahead, with both traditional and new energy vehicle makers likely to face an uphill road as China’s economy slows. The problem could be compounded as big new capacity comes online from many major automakers that have invested billions of dollars on expansion over...

Tom Konrad CFA What the Smart Grid will do for electricity, "Smart Transportation" will do for road-based travel.  Here are eight companies making Smart Transportation a reality. Congestion and Peak Oil In late 2005 Houston was evacuated as hurricane Rita approached.  The memory of Hurricane Katrina was still fresh in everyone's mind, and Houston, also called the Oil Capitol of the World, is extremely car-dependent.   100-mile traffic jams quickly formed on all the major routes out of the city.  Many people were stranded as their cars ran out of gas from driving for hours just...

On Friday, the House of Representatives and Senate passed H.R. 1, the American Recovery and Reinvestment Act of 2009 and sent the bill to President Obama for his signature. The impact on companies that manufacture advanced batteries and other energy storage devices will be staggering. The principal energy storage appropriations include: $2,000,000,000 for grants to manufacturers of advanced battery systems and vehicle batteries that are produced in the United States, including advanced lithium ion batteries, hybrid electrical systems, component manufacturers, and software designers;  $4,500,000,000 for grants for “Electricity Delivery and Energy Reliability” including activities to modernize the electric...

John Petersen Before moving to Switzerland in 1998 I lived and worked in Houston, Texas, a place that teaches you the importance of keeping an eye on long-term weather forecasts, particularly during hurricane season. Most of the time it turns out to be wasted effort because Mother Nature is fickle and highly unpredictable, but when it's important it's really important. The same logic holds for investments in energy storage and electric vehicle technologies. You have to keep a close eye on the industrial and regulatory climate and be ready to change your plans when conditions change. For...

While Korea is on red-alert to rising oil prices, Hyundai Motor Co., the nation's largest carmaker, is stepping up efforts to develop fuel-efficient cars that run on a combination of gasoline and electricity. Company officials said the introduction of hybrid cars should come around 2007 or possibly earlier.

Doug Young The number 94 seems to have special meaning for BYD (HKEx: 1211; 002594; OTC:BYDDF), the struggling car maker backed by billionaire investor Warren Buffett, which has just reported some preliminary data that show its profit last year fell 94 percent as it failed reverse its sharp decline of the last 2 years. But perhaps more alarming, this new data show the company's operations fell into the loss column in the last 3 months of 2012, even though it technically remained profitable overall due to strong government support. That means that 2013 could continue to...

Oregon continues rewarding people who buy hybrid cars. The state Department of Energy has announced that the 2005 Ford Escape will qualify for tax credits. Tax credits already apply to the 2004 Toyota Prius, Honda Civic and Honda Insight, and state DOE officials expect that the 2005 models of those cars will also qualify. I wanted to point out one key paragraph from the article above. Demand for Hybrid automobiles is soaring. In 2003, 509 people took advantage of the tax credit, said Justin Klure, a policy analyst with the Department of Energy. So far this...

John Petersen On June 27th Johnson Controls (JCI) hosted their 2011 Power Solutions Analyst Day and unveiled their expectations for the future of stop-start idle elimination systems. After noting that all automakers are developing a range of powertrains, JCI used this graph to emphasize their view that the overwhelming bulk of alternative powertrain vehicles over the next five years will have simple, cost effective and fuel efficient stop-start systems. You don't see much about stop-start systems in the mainstream media because politicians and reporters are too enchanted with plug-in vehicles and other exotica...

You can learn about Hybrid Cars at the excellent How Stuff Works website using the following link: How Hybrid Cars Work.

Two related pieces of news yesterday, one that was the day's headline and the other that drew a little less attention. First, the big news: auto makers, especially US-based ones, got hammered by their product mixes. As expected, Americans are responding to a rise in gasoline prices by turning away from trucks and demanding cars, especially small ones. Of course, this spells nothing but hard times for the likes of Ford, GM and Chrysler, who are still hungover from a decade-long party fueled by high-margin pick-up trucks and SUVs. Economic incentives, whether state-imposed or market-driven, work after all....

A couple of weeks ago, we received an inquiry from a reader asking us to look into potential beneficiaries of the American Recovery and Reinvestment Act (ARRA)'s high-speed rail (HSR) provisions. This sounded like something our readers would want to read about so I decided to do it. In a nutshell, here are the two main component's of ARRA's HSR approach: $8 billion for for HSR corridors and other intercity passenger rail service (unclear at this point how much will go into each, although the companies discussed below can benefit from both) The rules around state issuance...

John Petersen On April 8th the Electrification Coalition, a recently formed industrial lobby comprised of top-level executives from Cisco Systems (CSCO), Aerovironment (AVAV), NRG Energy (NRG), Rockwood Holdings (ROC), Nissan Motors (NSANY.PK), FedEx (FDX), A123 Systems (AONE) and a gaggle of private companies released a slick but wholly unenlightening white paper titled, "Economic Impact of the Electrification Roadmap." I haven't seen so many finely sculpted curves and unspoken assumptions since the tax shelter forecasts of the early-80s. The only clear message is that electric drive will be little more than a footnote in automotive history unless the powers...

Tom Konrad CFA There are many proposed solutions to the liquid fuels scarcity caused by stagnating (and eventually falling) oil supplies combined with growing demand in emerging economies.  Some will be good investments, others won't.  Here is where I'm putting my money, and why.  This second part looks at hydrogen and electrification strategies for replacing oil. In Part I of this series, I listed four potential substitutes that have been proposed to replace oil as limited supply and growth in developing markets draw oil away from traditional users.  I've since added a fifth to my list...

John Petersen Epic is the only word I can use to describe an evolving tragedy that killed tens of thousands of people, inflicted hundreds of billions in property damage, destroyed 3.5% of Japan's base-load power generating capacity in a heartbeat and will cause recurring aftershocks in the global electric power, transportation and energy storage sectors for decades. While I'd love to believe the worst is behind us, I fear the times of trouble have just begun. Since it's clear that Japan will have to turn inward and serve the urgent needs of its own population first, the...