Yahoo Finance Hyliion CEO: Goal is to be 'dominant' electric powertrain for trucking industry
Outside of Pittsburgh, Pennsylvania, electric transport company Hyliion (HYLN) is doing things a little differently.
Rather than building complete electric trucks and tractor trailers, Hyliion builds electrified powertrain systems that can augment or replace traditional ICE (internal combustion engine) powertrains in existing or new trucks. All Hyliion needs is the truck chassis to bolt on its system.
While the company is able to retrofit batteries and add a small electric motor to make traditional trucks into hybrids with its Hybrid EX technology, it also produces the Hypertruck ERX, which replaces the entire powertrain of a ICE-powered truck with an electric motor and battery system.
But there's a twist. The big change here is that renewable natural gas (RNG), which comes from organic waste emissions, powers a generator, which in turn charges the system’s batteries, which then powers the e-motor that drives the truck’s rear axle.
Using RNG allows the truck to have much longer range than an all-electric truck powered by batteries, plus it can be refueled at RNG filling stations across North America. The system also allows for around 75 miles of all-electric driving if needed. Hyliion is planning controlled fleet trials of the Hypertruck ERX later this year.
The process of turning over and changing larger truck fleets is key to the business. “We're going after the new trucks that fleets are buying into their operations, and most fleets will turn over about a quarter to a third of their trucks every single year,” CEO Thomas Healy told Yahoo Finance Live. “So with some of these big fleets, some of the ones we're working with, like the Schneiders (SNDR), the Werners (WERN) of the world, who operate thousands and thousands of vehicles, they'll be turning over thousands of trucks every year.”
Healy says large fleet operators prefer the flexibility of a product like Hypertruck ERX over all-electric options, because while it's an EV, the Hypertruck ERX actually brings the power plant onboard the truck, powered by relatively cheap RNG — a big deal these days.
“Well, the great thing of what's going on right now is, while we're seeing diesel prices continue to climb, natural gas has stayed low. We have fleets that are buying natural gas at around $1 per gallon, whereas, diesel, I think we're seeing north of $5 in some areas of this country,” Healy says. “When you look at an ROI [return on investment], a payback of our product, that higher diesel fuel pricing allows us to even see a faster payback on our product.”
While overall ROI isn’t happening at the moment quite yet for Hyliion, Healy and investors are betting for a payoff to happen within the next two years.
“As we go into the latter part of '23 is when we'll actually start shipping these units and recognizing revenue on them, and that's really the system that we see as the game changer for this industry,” Healy says. “This industry is huge, 300,000 vehicles produced every single year, and our goal is to really go be the dominant powertrain to bring electrification into the long haul space.”
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Pras Subramanian is the senior autos reporter for Yahoo Finance. You can follow him on Twitter and on Instagram.
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