Autogas conversion company works to get customers out of their comfort zone

February 20, 2014 By    

Precision Sales and Service Inc., a Birmingham, Ala.-based company that converts vehicles to run on alternative fuels, has steadily seen business related to propane autogas vehicle conversions pick up.

Buddy Gamel, Precision Sales and Service Inc.

Buddy Gamel, Precision Sales and Service Inc.

In January, for example, Precision Sales and Service completed 10 autogas conversions on Alabama Department of Corrections (DOC) vans, and the potential for future business with such customers is great, Precision Sales and Service owner Buddy Gamel says, because a number of companies with fleets have tens, perhaps even hundreds, of other vehicles that could be converted.

“Once [the DOC] starts getting some numbers in, they’re looking at doing somewhere around 60 more conversions,” Gamel says. “They have 100 vans running in the state right now. The state is looking at this project very carefully to see what kind of savings they’re going to have.”

If the DOC experiences savings to the state’s liking, Gamel says other state departments may want in on autogas.

“It’s going to flow over into other departments and areas of the state,” he says. “You have maintenance trucks. There’s thousands of cars and vehicles that could be running on an alternate fuel.

“Back in 2009, we converted 11 vehicles for the Alabama Department of Agriculture. These were state inspectors running all over the state. They were realizing savings of around $2,000 per vehicle per year. It’s a no-brainer when you can see that kind of savings.”

How has the autogas market evolved for Precision Sales and Service, which has been converting vehicles for more than 20 years? And what is Gamel’s vision for the future as it relates to autogas? LP Gas asked Gamel these questions and more in a recent interview.

LP Gas: How would you describe the propane autogas conversion marketplace these last few years compared with some of your company’s earlier years?

Gamel: The marketplace has changed. People are now calling me, saying they’ve already done the math and that propane looks like it makes a lot of sense. It is. It’s the best alternate fuel there is. I’ve got businesses now that are calling, whereas before we were knocking on doors trying to get anybody we could.

I’ve given presentations and done seminars at workshops for years trying to find anybody who would listen, telling them there’s a day coming you’re going to need this [technology]. Since 2007, when gasoline started going up and hit $3 a gallon and I was getting three to four phone calls a day, business has increased. People were remembering their fathers and grandfathers who were working at businesses that were running trucks on propane.

I’ve actually hired a salesman who’s going out and talking to potential customers now. We’re knocking on more doors than ever now.

LP Gas: It sounds like business today is as good as it’s been for you. What factors might hold your business back from growing further with autogas conversions?

Gamel: There’s still that same customer and the willingness to make that initial investment, or do something out of the ordinary. Getting people out of their comfort zone and seeing they can save money doing this [is still a challenge].

None of these alternate fuels are new. They’ve been around 100 years. Everybody thinks what’s going on is new. Whenever I do a presentation I ask, “Does anybody know this is not new technology? Not a new fuel?”

For example, does anybody know when biodiesel was invented? Some people say within the last 10 years. I say George Washington Carver invented biodiesel 95 years ago. The technology sat on the shelf for 95 years. It’s the same thing with propane and methane gas. They’ve been used as motor fuels for years.

LP Gas: What excites you the most about the potential for your business over the next five years?

Gamel: The possibility of having one conversion after another come into the shop and talking with the people who have fleets that are interested in converting their entire fleet nationwide. We did a conversion last week for a company that’s seriously looking at converting their entire fleet, which consists of 150 vehicles. The customer asked me, “Are you planning on expanding your business? Because I don’t see this as slowing down.” I don’t see this slowing down either.

Any company should expand slowly. I see that as one thing that [didn’t] happen with a lot of conversions about 12 to 14 years ago. Conversion companies were anticipating an enormous boom, because around 2002 the state of Arizona passed some legislation [in which] they were going to subsidize the cost of alternate fuel vehicles to the tune of paying 50 percent of the cost of the vehicle.

Well, some very savvy people saw through the writing of that bill and realized they could go and buy a $40,000 Hummer, have someone put a conversion system on it, and the state was going to pay half. The state had budgeted $4 million for that project. The governor of Arizona shut the program down when they had requests for $64 million with [Ford] Expeditions, Hummers and other vehicles. People were buying $35,000 to $45,000 vehicles and applying for the rebate. The state’s intentions were good, but like so many politicians do they didn’t think it through.

That caused a huge ripple effect in the industry. It put some conversion shops out of business because they were stuck with all of those parts and inventory that they had geared up for. The tank manufacturers had leftover inventory they couldn’t sell. It was really a quagmire for a while.

LP Gas: In your view, how is autogas currently being perceived as an alternative motor fuel in the marketplace versus compressed natural gas (CNG)?

Gamel: Ninety-plus percent of the conversions we do are still propane. One reason this is the case is because of the high cost of doing CNG conversions. People look at the return on the investment. The second reason is the refueling infrastructure – it’s still not readily accessible for CNG. A third thing is the lack of a reasonable fuel range for a lot of customers. Customers don’t want to go and fuel their trucks every day. That’s not being productive. With propane, we can put almost four times as much fuel range on a vehicle in the same amount of space, and for half the cost.

CNG is ramping up in technology, though. There are new cylinder manufacturers coming along. Otherwise, the rest of the system is very similar to what we use for autogas.

This is posted in Blue Flame Blog

About the Author:

Kevin Yanik was a senior editor at LP Gas Magazine.

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