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December 05, 2018   |   The Wall Street Journal


Business’s Climate Challenge: Getting Customers to Pay

What will make a bigger difference to global warming: sleek electric sedans like those made by Tesla Inc., or heavy duty trucks, powered by the sort of engines that Cummins Inc. is testing at its research center here just south of Indianapolis?

The answer is the latter, for a simple reason: Most of the world thinks like a Cummins customer, not a Tesla customer. A Tesla buyer isn’t trying to save money: It is “an emotional buy,” says Wayne Eckerle, Cummins’s head of research. Cummins customers are commercial truck operators: “They don’t buy on emotion. At all.” Committed as Cummins is to combating climate change, any innovation it offers must meet one simple rule: pay for itself within 18 months.

Cummins is spreading its bets, developing a mix of electric, hybrid and natural-gas powered motors for small and medium-size trucks. But long-haul heavy trucks will, for the foreseeable future, run on diesel. Besides costing a fortune, an electric truck’s batteries would reduce payloads and recharging time would lengthen trips.

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