LNG investments pending but IVECO remains Italian
6 May 2021 - ConferenzaGNL
by Diego Gavagnin
The “news of the day” was supposed to be the role of small scale LNG in the National Recovery and Resilience Plan (PNRR) but in the very latest version the topic was expunged. The Council of Ministers that approved it on April 29th, however, launched a Complementary Fund to the same PNRR which provides for “Sustainable infrastructure and mobility (renewal of fleets, buses, trains and green ships) …” endowed with 30.6 billion euros . It will be a decree law whose text is not yet known.
A few days earlier, the sale of Iveco to Faw Jiefang, the largest Chinese manufacturer of heavy trucks, failed. The rejected economic offer would have been close to 3.5 billion euros. Together with Iveco, the parent company CNH Industrial would also have sold a part of FPT Industrial, the company that produces engines, in particular those powered by LNG, which are having significant success.
CNH has announced that it will continue in the spin-off of the two activities in 2022, but it is certain that they will remain Italian. In fact, to read the unanimous comments of the press and the statements of the Minister for Economic Development Giancarlo Giorgetti, the Government would have been willing to prevent the sale to a foreign entity, even by exercising its power of veto (“golden power”).
Little was known about the reasons for the attempted sale, even if a trace is found in Giorgetti’s statement: “We are ready to sit down at the table to protect and maintain this production in Italy. We positively evaluate the news, the Government has followed the whole affair with attention and discretion, we believe the production of heavy vehicles on rubber is of national strategic interest “.
Since the future of diesel trucks is certainly not rosy, the interest of the Chinese for Iveco and FPT could only be the wealth of knowledge on LNG engines, an area in which the two Italian companies are leaders in Europe (in Italy with about 80% of the market). It is no coincidence that our country has the largest number of LNG trucks in circulation (almost 4,000) and that of service stations with LNG, over 110 (25% of all those in Europe).
With these numbers, which are constantly growing also due to the widespread use of bioLNG (with zero ecological footprint) instead of fossil LNG, Italy is second in the world. Behind China. Except that in that country there are over 400,000 LNG trucks in circulation. Sales have doubled since 2018, also due to the more stringent limits on transport emissions decided by the Government. Now the problem is the filling stations, which can’t keep up with the trucks.
ConferenzaGNL is happy if Iveco and FPT remain Italian, but we do not believe that the intention of the Chinese was to pack everything to take it home. If what they were looking for is quality, which they still have to work on, that comes from people. It is more likely the intention to finance new development to penetrate even further into the markets, and learn.
It seems that Draghi himself intervened on the Exor of the Agnelli family, owner of CNH, to prevent the sale, promising production support. In 2019 the Chinese market absorbed more than 100,000 LNG trucks, Faw Jiefang produced 2,000 per month. The curiosity about what will be written in the Complementary Fund increases.