Andrew Littlefair is the CEO and co-founder of Clean Energy Fuels (NASDAQ:CLNE), the leading provider of natural gas for transportation in North America. Clean Energy provides CNG and LNG fuels to solid waste, trucking, and transit fleets, among others, and currently operates some 500 fueling stations in the United States and Canada, as well as manufacturing related equipment and technologies.
Natural gas is well established among fleet vehicles such as refuse trucks and transit buses, and may be about to take off in the massive heavy-duty trucking market -- but what about light duty vehicles? In this video segment, Littlefair discusses the potential for increased availability of natural gas powered passenger cars and pickup trucks, including how Westport Innovations' (NASDAQ:WPRT) partnerships with Ford (NYSE:F) and Delphi will lead to more natural gas vehicles for the consumer market, as well as fleets.
Andrew Littlefair: We could use more product for the light duty stuff -- we've struggled a little bit with taxicabs -- but when you drove in here this morning, at John Wayne Airport across the street from our headquarters here, all those taxicabs are natural gas. In San Francisco, all the taxicabs are natural gas. That market continues to grow.
Shuttles and shuttle buses, we now operate at 39 airports in our core market. We're building some more right now. We just opened at Kennedy Airport; we've got a big one going in right now at Chicago O'Hare. That's a nice market for us; we don't have much competition. In that market, we have nice margins, we own those stations, we're selling against gasoline and diesel, and we can save those customers $1.50 a gallon, which is meaningful.
Jason Hall: I think there are two things that could potentially continue to help that part of your business grow. Chevrolet's got the new Malibu CNG?
Littlefair: I think the Impala.
Hall: The Impala, right.
Littlefair: Which could be a great taxicab, because we've been struggling on that -- we had the Transit Connect from Ford -- so the Impala would be great.
Hall: Right. Plus Delphi and Westport Innovations now have an OEM agreement, and there's potential for that to go downstream.
Littlefair: You'll see more and more of it. This is still niche-y for the big OEMs, but you're seeing more; now the F-150, Ford is preparing that engine (featuring Westport Innovations' WiNG system), so that could be very good for municipalities and others.
You'll see more. The new Ford Transit, they're getting away from the old Econoline van and they're coming out with a bigger product that looks more like a Sprinter van. That'll be on natural gas too.
We have high hopes for that, and I think you're right. We've talked a lot about the America's Natural Gas Highway and heavy-duty trucking, and let me just mention this:
In our core markets, if every transit bus in America went to natural gas, that's about 1.5 billion gallons annually. Then airports are about 2 billion, so there's a lot of work to be done, still, in those areas. Refuse is about 2 billion gallons, so roll that all up and call it 6 billion gallons. Heavy-duty trucking is 30 billion gallons, so it's five times bigger.
I think it's appropriate for us to focus a lot on that because it's a very big market, but our other market's alive and well, and doing well. We continue to grow, and right now this year, on what we call our carpet -- our construction carpet, of things that are under way -- we have a total of 48 core stations underdevelopment right now, that will get built. If they don't all get built this year, it will be very close to all of them getting built this year, so it's a big part of our business.
One of the things, and you may ask me about this later -- I can go into more detail -- but one of our advantages is we have a compressor company, so most of the core markets that I've talked about are CNG. There are a few exceptions, but not many, so most all transit buses are CNG now; everybody's figured out that's the way to go, and the same with the refuse trucks.
We're able, for instance, to sell our equipment into Waste Management. We sell our equipment into Republic Waste, so it gives us an advantage.
Hall: I'm glad you brought up IMW, and we'll definitely circle back. There's definitely some value there and I'd like for you to add onto that.