July 24, 2025 • 18 mins
Christoph Horn, Fleet Account Executive at Cummins, joins us to unveil the company’s next-generation engine roadmap through 2027. From the all-new Octane 6.7L to the powerful X15, Christoph shares how Cummins is driving advancements in power, fuel efficiency, and durability. He also provides insights into the current regulatory landscape and what it means for fleet planning across the industry. Tune in now to learn more.
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Episode Transcript
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Jason Cuddy (00:12):
Hello and welcome to another episode of the
Transportation Exchange podcastpresented by Rush Trucks and
Canada.
I'm your host, Jason Cuddy, andwe welcome back this time
Christoph Horn, who is the fleetaccount executive at Cummins.
Christoph, welcome back.
Christoph Horn (00:24):
Well, thanks a lot, Jason, Really happy to be
here, and I know we've tried toget together a few times over
the last little while and youknow sorry it took so long, but
I think the timing's perfectright.
Like we got new productslaunching next year, even more
launching in 2027, and some bignews with regards to the
15-liter product as well Not somuch changing with the product,
(00:47):
but some changes with regards totiming, which I'd love to get
out to yourself and to yourlisteners.
Jason Cuddy (00:52):
Correct.
Yeah, there's a lot going onand you know, behind the scenes
there's been a lot of movementin the industry.
But I think the main focusreally here is the concrete
stuff, which is, you know,different products you guys are
launching specifically for 27.
You know, so we've got a littlebit of a window first, but it's
nice to kind of understandwhat's coming so customers can
kind of prep and see what thebig changes are.
I guess maybe we'll start onthe medium-duty side let's start
(01:14):
with.
I guess we'll go from smallestto biggest.
Let's talk about the B6.7,which everyone knows and loves.
What is the changes?
Christoph Horn (01:20):
Yeah.
So starting with the B makes alot of sense, not just because
it's the smallest, but becausethat's the one that's going to
not so much change next.
But there's a new entering themarket on the B side, so it's
the product that we launched orsorry, we didn't launch.
We announced last March at theWork Truck Show it goes into
production January of next year.
(01:42):
It's the Octane, so it's thesimplicity of gasoline with the
reliability, durability andperformance of diesel.
Jason Cuddy (01:50):
Nice.
Christoph Horn (01:57):
You know we can't just launch a gasoline
engine, have to make itdiesel-like, which it certainly
is.
So it's a 6.7 liter inline-sixturbocharged gasoline engine,
simple after-treatment thatyou'd expect with a gasoline
engine, so there's no doc, dpfor scr and you know, from a
performance standpoint very muchlike diesel, as I mentioned.
So ratings up to 300 horsepower, 600 foot pounds of torque, and
(02:20):
when you compare that, thatrating, that in that torque, to
a traditional V8 gasoline engine, you notice that it occurs at
lower engine speeds much morediesel-like feel to the product.
Also, with the technology andthe architecture of the engine,
we're going to see about a 10%improvement in fuel economy
(02:43):
versus a traditional V8 gasolineengine as well.
So you know, from anapplication standpoint you know
(03:09):
vocational applications it'll bea really nice fit there.
Jason Cuddy (03:11):
Yeah, and especially a lot of high idle.
We have a lot of customers whodo that, where they don't
necessarily need the power perse, but the island cost,
especially with the diesel stuff, becomes an issue.
So having similar power isgreat, but, yeah, it opens up a
different market obviously.
But the fuel economy savingsversus a standard V8 that you
would normally have in a vehiclethat size is incredibly
significant.
Christoph Horn (03:32):
Yeah, it is yeah , and a lot of customers that
are operating in thoseapplications are quite excited
for the Octane to roll off theline and they can start
utilizing and getting each ofthose benefits.
Jason Cuddy (03:46):
That would be neat and so obviously, with that
coming in it kind of for lack ofbetter words kind of displaces
the current diesel model.
Where is the diesel modelheaded as we move into 2027?
Christoph Horn (03:56):
Yeah, so there's still going to be a diesel B
engine.
The change will happen in 2027.
B engine the change will happenin 2027.
We're going to sunset the 6.7liter and go to a new block with
new components, a 7.2 liter,b6.7 engine.
And there's really three mainreasons for switching from the
(04:19):
6.7 to the 7.2.
The first is increases withregards to fuel efficiency.
So what we're doing is we'redropping rated engine speed and
peak engine speed, but in orderto keep the rating similar to
what we have today and actuallyincrease the torque and
horsepower available, we neededto increase the size of the
(04:43):
engine, the displacement.
So the number one is fuelefficiency, greenhouse gas
related.
Number two is nox emissions.
Right, a lot of the productstoday not not even just speaking
about cummins, but you knowthere are some significant
changes occurring and theproducts need to be reflective
in those changes.
So increasing the size of thedisplacement reduces peak engine
(05:03):
temperatures, which whichreduces NOx emissions Gotcha,
the other emission-relatedcomponent that not a lot of
people know about, but there'srobustness requirements.
And the 7.2 liter going from a7.2 to a 6.7 to a 7.2, sorry
increases the robustness of theproduct, gotcha.
And then lastly and this isprobably not good etiquette on a
(05:23):
podcast, but I'm going to letthe cat out of the bag.
The 9-liter is going away.
Jason Cuddy (05:27):
Right.
Christoph Horn (05:29):
So we needed the B to be a little more robust
and have higher ratings toaccommodate for the ratings that
we're going to lose on.
The replaces the 9,.
But we do need that B to be alittle bit more capable and
slide into some of those 9-literratings that will no longer be
(05:51):
so.
The 7.2 will go all the way upto 360 horsepower, 1,000
foot-pounds of torque, whereasthe 9, you know it was all the
way down to sorry 260 to 860.
Gotcha, so that's so much, youknow.
It moves up into those 9-literratings, those low 9-liter
ratings, quite nicely.
Jason Cuddy (06:12):
That'll be interesting because I mean there
are some customers that kind ofstraddle that line right.
I mean traditionally we'd have,you know, a single axle
medium-duty truck would have theB6.7, a tandem by default.
You usually got the L9 justbecause of the perceived weight
that's going to be on it.
But now there's that potentialwhere that tandem customer can
run with a 7.2, don't need allthat displacement.
Obviously there'll be some fuelsavings versus a 9 liter from
(06:33):
the traditional way.
So that could be prettyexciting for different customers
where they can kind of stepdown in displacement size but
not really lose any of theperformance and power.
Christoph Horn (06:42):
That's right, and you're going to gain some
weights or you're going tobenefit from the weight savings
as well.
That's a good point.
Yes.
Jason Cuddy (06:48):
So then, with you know, as you mentioned the L9,
so obviously that istransitioning as well for 27.
What can we expect?
Christoph Horn (06:54):
Yeah, so the L9, there's twofold.
So we're going to straddlemedium duty and heavy duty here.
The new product is called theand it will replace both the L9
and the X12 come 2027.
Gotcha, right.
So there's going to be twohardware sets for the X10.
There's going to be theproductivity series hardware set
(07:16):
and there's going to be theperformance series hardware set,
gotcha.
So the productivity series ismore or less the L9 ratings from
the past and then theperformance ratings are the X12
ratings from the past.
And then where do we see theproduct fitting in?
You know we call it theworkhorse and it's really going
(07:41):
to take on that mantra, rightthe same as the L9.
So heavy vocational focus, youknow some P&D work, but
vocational transit bus, refusetruck, vac truck.
But then also with theperformance ratings, ratings are
going to go up to 450, 1650.
So also a capable engine in atractor application, especially
(08:05):
if we're thinking about weightsensitive day cab, day cab work.
Jason Cuddy (08:09):
It'll fit quite nicely in there as well that's
pretty impressive, yeah, becauseif you're kind of merging the
two into one, you got to kind ofcover all lines.
But that's good to know,because that's always.
You know people are concernedokay to you know the
displacement's coming down soI'm losing power, but you're
right up there almost with youknow where, where that size and
you know the 12 liters play inyeah, yeah and and then the the
product is it's already inproduction today globally.
Christoph Horn (08:31):
Okay, um, so, for those who aren't aware, all
of our engines for north americaare made in north america, so
the x10 will be made, just likethe l9 is today in rocky mount,
north carolina.
We north americanize it andit's currently in test and then,
once we go to full production,it'll be made in Rocky Mountain.
Jason Cuddy (08:48):
Nice.
And then I guess the last oneto talk about is kind of the
bread and butter Everyone goesto, it defaults to with you guys
, which is the X15.
Nomenclature is staying, butthere's still again for 27.
Are some changes?
Yeah?
Christoph Horn (09:01):
And before we talk about the product itself, I
think we should talk about thetiming and I alluded to it off
the top.
The plan was and I think anyonewho's in the heavy duty
industry likely aware certainlyyou're aware if you have someone
from Cummins that you work withthe plan was to launch that
(09:21):
product and bring the benefitsof that product to market in
2026.
We recently made some changesand decided, rather than
launching it in 2026, we wouldlaunch in 2027 along with the
other products that we'rebringing to market at that time.
And the reason for that, youknow, is twofold for the most
(09:41):
part.
One is, you know, economic.
You know the pressures continueto be applied with regards to
economic pressures and you knowyou just had James in, I'm sure
you talked about that, you knowhe can continue to have those
conversations with you he'sperfect for that but, yeah,
those are really disrupting thebuying cycle with regards to our
customers right now.
(10:01):
And the second is from aregulatory standpoint is from a
regulatory standpoint, 2027 isstill happening.
We're aware of that.
But what happened, and whatcustomers may not be aware, is
that a month ago, six weeks ago,donald Trump signed the CRA,
the Congressional Review Act,and what that did is it revoked
(10:23):
CARB mandates, specificallyOmnibus, which was a low NOx
rule for between now and 2027that CARB had implemented at 50
milligrams.
It also revoked advanced cleantruck, which was the mandate
that stated that OEMs anddealers had to sell a certain
(10:46):
percentage of zero emissionvehicles before they could
unlock internal combustiondiesel sales.
And then, thirdly, this wasn'tpart of CRA but CARB didn't
pursue advanced clean fleet,which was the mandate that they
were considering bringing aboutto ensure that fleets were
(11:08):
purchasing zero-emissionvehicles that they wanted to
operate and travel intoCalifornia.
So that decision and thatchange brought about the fact
that originally we were going tobe able to sell 200 milligram
trucks in 46 states.
With that change we're able tosell 200 milligram, or current
(11:31):
production, I should say engines, in 49 states, Gotcha, Every
state other than California.
So we really saw a decrease inthe need or the demand for the
product.
So the decision was made andI'll reiterate it to continue
operating the current productthat we know today all the way
through to the end of 2026 andthen switch over to the 2027 x15
(11:57):
in 2027 gotcha, and yeah, those2027 epa guidelines are still
in place, despite everythingelse that has changed.
Jason Cuddy (12:04):
Yeah, you know, stuff still keeps moving.
You know that's the, theunknown, but clearly the 27,
every oem is so invested thatyou know that's not going away.
Um, but then that's where Iguess the X-15, the first main
changeover, comes into play.
Christoph Horn (12:16):
Yes, yes, and I should just mention as well for
fleets, that we're lookingforward to the we called it the
pull ahead provision.
We are still making a limitedproduction of the product in Q4
of 2026.
So that's the 27 product will gointo limited production, but
during that time we'll still bemaking the 200 milligram product
(12:39):
as well, so there is going tobe a little bit available.
But by and large, 2026 will beall 200 milligram production.
Then, as you mentioned, 2027,the whole product range.
The diesel product range thenflips over um to to the products
that we were just discussinggotcha and then tied to that.
Jason Cuddy (12:57):
You guys have made some changes to that block as
well and kind of how itinteracts with not just diesel,
obviously yes, as you go forward, maybe explain a little bit of
what's sure that is yeah sure.
Christoph Horn (13:06):
So that's a.
We could do a whole podcast onthat true so the the,
specifically the x15 um it's.
It's been in global productionfor a number of years.
I believe we've got 58,000 ofthem globally produced and 7.3
billion miles on them.
(13:27):
But we first brought thatproduct to North America and
launched the natural gas enginein 2024.
So this will be the dieselvariant and it will replace the
current diesel product, asmentioned in 27.
And it is a new block designversus what we had before.
So the current product is alegacy product that's
(13:48):
essentially carried on since 98when we launched the Signature
600.
So, yeah, it's coming up for arefresh.
We've launched a Signature 600.
So, yeah, it's coming up for arefresh.
And, yeah, the new block islighter, significantly lighter
than the other product.
Just base engine alone.
Reduction of parasitic losseswe're anticipating to see about
a 4% fuel economy improvement,base engine alone.
(14:11):
And then also on top of that,we you know we bought meritor jv
with eaton, so we've got uhdriveline as well.
That we're that.
We're making uh additional uhfuel efficiency improvements to
uh.
We're probably gonna see aboutseven percent driveline related
improvement for 27.
So very significantimprovements.
(14:31):
And then everything that youknow, navistar and our oem
partners do with regards toaerodynamic would just be over
and above so, some reallysignificant savings that we're
going to see there with regardsto fuel economy improvements on
the X15.
Jason Cuddy (14:46):
Which is nice, because I know everyone's always
challenged with, especiallywhen you get to different EPA.
Bumps in the technologyObviously there's cost involved,
and it is what it is.
Bumps in the technologyObviously there's cost involved,
it is what it is, but it's niceto see to some aspect, although
, yes, there is a bit of a costincrease as we go into these new
technologies.
What it keeps doing, though, iscreating an offset of a cost
reduction in fuel savings, andyou're not talking small numbers
(15:06):
, you're saying potentially fiveto seven.
By having an all-in drivelinewith your engine paired with the
Endurant and with the Meritoraxles, and then, yeah, with the
OEM, has you know?
Then you take some weight outof the vehicle, you put on aero
and you match that up withtrailer packages, like you can
see significant fuel savings asyou roll into 27.
So, despite the uptick in, youknow capital costs of the
(15:29):
vehicle.
You know over the long term,you know it should be very
beneficial to most fleets.
Christoph Horn (15:33):
Yeah, and that's kind of how I mentioned.
You know we're delaying some ofthe benefits, unfortunately, of
the next generation product.
But you know, from an economicstandpoint, from a regulatory
standpoint, probably the rightdecision, and then you know
we'll eventually get there when2027 hits.
Jason Cuddy (15:53):
Yeah, and I think part of you know by keeping it
static up until 27,.
I know you know to your pointwe'd have Menzies in before
talking about.
You know what the year lookedlike and everyone you know.
Before the slowdown happened,everyone was predicting.
You know, this year intomid-december next year was your
big pre-buy.
Yeah, and no one's seen thatyet.
But you know this may also willhelp with this because
(16:16):
obviously if you're not doingkind of that mid cycle bump
halfway through next year,obviously the cost stays fairly
static.
Christoph Horn (16:20):
Yes.
Jason Cuddy (16:20):
Up until 27.
So that may help encourage thepre-buy to some extent as well,
potentially.
Christoph Horn (16:24):
Yeah, I think it depends a little bit on what
the freight market does.
But you know, from a commonsperspective, fleets certainly
have longer if they wish topurchase the current product
before going to the nextgeneration, 2027, I should say
X15.
Yeah, yeah, so it'll beinteresting.
Yeah.
Jason Cuddy (16:43):
There's definitely lots to look forward to.
But you know, that's why wewant to have you on, just kind
of get an overview of what'scoming down the pipe, right, so
people can start planning.
You're at, you know, as we'retalking now it's the middle of
the summer.
So planning you're at.
You know, as we're talking nowit's the middle of the summer.
So you know, fleets startputting together their budgets
and their numbers for 26, right.
So this is good, at least sothey know what the market looks
like for 26 and then obviously,what what's coming down for 27,
(17:04):
and they can, you know, planaccordingly of.
You know how much they want toget it now, before later.
And then, hey, maybe hold offand take advantage of, you know,
something like the x10 or youknow, or the b7.2, and that may
help take some fuel costs out.
This gives them a better way tokind of potentially manage
their fleet over the next coupleof years, given the technology
that's coming down the pipe.
Christoph Horn (17:22):
Yeah, I agree wholeheartedly, and I think this
wasn't an easy decision fromCummins.
We'd been looking at doing thatfor that other strategy for a
little while, but, um, it wasabout the last possible moment
that we could, that we couldmake this switch, even from,
like, a supply perspective.
Right, because you know we doneed to to plan ahead from that
(17:44):
regards.
And yeah, and then it's, it'sgoing to be the same.
Um, there, you go.
Jason Cuddy (17:50):
So we've got some stability in the market.
For now we do, yes, which isgreat.
Hey well, look, I appreciateyou coming on and sharing this
information.
It's always good to have youguys come in and kind of give us
a temperature check of theindustry what's happening
technology-wise, and you guyshave a lot going on, especially
coming for 27.
So I really appreciate yousharing that with us.
Christoph Horn (18:05):
Thanks, jason, appreciate it.
Thank you.
Jason Cuddy (18:15):
And that does conclude today's episode.
To catch past episodes, checkout
transportationexchangepodcastca.
Until next time, thanks forwatching.
Hello and welcome to another episode of the
Transportation Exchange podcastpresented by Rush Trucks and
Canada.
I'm your host, Jason Cuddy, andwe welcome back this time
Christoph Horn, who is the fleetaccount executive at Cummins.
Christoph, welcome back.
Christoph Horn (00:24):
Well, thanks a lot, Jason, Really happy to be
here, and I know we've tried toget together a few times over
the last little while and youknow sorry it took so long, but
I think the timing's perfectright.
Like we got new productslaunching next year, even more
launching in 2027, and some bignews with regards to the
15-liter product as well Not somuch changing with the product,
(00:47):
but some changes with regards totiming, which I'd love to get
out to yourself and to yourlisteners.
Jason Cuddy (00:52):
Correct.
Yeah, there's a lot going onand you know, behind the scenes
there's been a lot of movementin the industry.
But I think the main focusreally here is the concrete
stuff, which is, you know,different products you guys are
launching specifically for 27.
You know, so we've got a littlebit of a window first, but it's
nice to kind of understandwhat's coming so customers can
kind of prep and see what thebig changes are.
I guess maybe we'll start onthe medium-duty side let's start
(01:14):
with.
I guess we'll go from smallestto biggest.
Let's talk about the B6.7,which everyone knows and loves.
What is the changes?
Christoph Horn (01:20):
Yeah.
So starting with the B makes alot of sense, not just because
it's the smallest, but becausethat's the one that's going to
not so much change next.
But there's a new entering themarket on the B side, so it's
the product that we launched orsorry, we didn't launch.
We announced last March at theWork Truck Show it goes into
production January of next year.
(01:42):
It's the Octane, so it's thesimplicity of gasoline with the
reliability, durability andperformance of diesel.
Jason Cuddy (01:50):
Nice.
Christoph Horn (01:57):
You know we can't just launch a gasoline
engine, have to make itdiesel-like, which it certainly
is.
So it's a 6.7 liter inline-sixturbocharged gasoline engine,
simple after-treatment thatyou'd expect with a gasoline
engine, so there's no doc, dpfor scr and you know, from a
performance standpoint very muchlike diesel, as I mentioned.
So ratings up to 300 horsepower, 600 foot pounds of torque, and
(02:20):
when you compare that, thatrating, that in that torque, to
a traditional V8 gasoline engine, you notice that it occurs at
lower engine speeds much morediesel-like feel to the product.
Also, with the technology andthe architecture of the engine,
we're going to see about a 10%improvement in fuel economy
(02:43):
versus a traditional V8 gasolineengine as well.
So you know, from anapplication standpoint you know
(03:09):
vocational applications it'll bea really nice fit there.
Jason Cuddy (03:11):
Yeah, and especially a lot of high idle.
We have a lot of customers whodo that, where they don't
necessarily need the power perse, but the island cost,
especially with the diesel stuff, becomes an issue.
So having similar power isgreat, but, yeah, it opens up a
different market obviously.
But the fuel economy savingsversus a standard V8 that you
would normally have in a vehiclethat size is incredibly
significant.
Christoph Horn (03:32):
Yeah, it is yeah , and a lot of customers that
are operating in thoseapplications are quite excited
for the Octane to roll off theline and they can start
utilizing and getting each ofthose benefits.
Jason Cuddy (03:46):
That would be neat and so obviously, with that
coming in it kind of for lack ofbetter words kind of displaces
the current diesel model.
Where is the diesel modelheaded as we move into 2027?
Christoph Horn (03:56):
Yeah, so there's still going to be a diesel B
engine.
The change will happen in 2027.
B engine the change will happenin 2027.
We're going to sunset the 6.7liter and go to a new block with
new components, a 7.2 liter,b6.7 engine.
And there's really three mainreasons for switching from the
(04:19):
6.7 to the 7.2.
The first is increases withregards to fuel efficiency.
So what we're doing is we'redropping rated engine speed and
peak engine speed, but in orderto keep the rating similar to
what we have today and actuallyincrease the torque and
horsepower available, we neededto increase the size of the
(04:43):
engine, the displacement.
So the number one is fuelefficiency, greenhouse gas
related.
Number two is nox emissions.
Right, a lot of the productstoday not not even just speaking
about cummins, but you knowthere are some significant
changes occurring and theproducts need to be reflective
in those changes.
So increasing the size of thedisplacement reduces peak engine
(05:03):
temperatures, which whichreduces NOx emissions Gotcha,
the other emission-relatedcomponent that not a lot of
people know about, but there'srobustness requirements.
And the 7.2 liter going from a7.2 to a 6.7 to a 7.2, sorry
increases the robustness of theproduct, gotcha.
And then lastly and this isprobably not good etiquette on a
(05:23):
podcast, but I'm going to letthe cat out of the bag.
The 9-liter is going away.
Jason Cuddy (05:27):
Right.
Christoph Horn (05:29):
So we needed the B to be a little more robust
and have higher ratings toaccommodate for the ratings that
we're going to lose on.
The replaces the 9,.
But we do need that B to be alittle bit more capable and
slide into some of those 9-literratings that will no longer be
(05:51):
so.
The 7.2 will go all the way upto 360 horsepower, 1,000
foot-pounds of torque, whereasthe 9, you know it was all the
way down to sorry 260 to 860.
Gotcha, so that's so much, youknow.
It moves up into those 9-literratings, those low 9-liter
ratings, quite nicely.
Jason Cuddy (06:12):
That'll be interesting because I mean there
are some customers that kind ofstraddle that line right.
I mean traditionally we'd have,you know, a single axle
medium-duty truck would have theB6.7, a tandem by default.
You usually got the L9 justbecause of the perceived weight
that's going to be on it.
But now there's that potentialwhere that tandem customer can
run with a 7.2, don't need allthat displacement.
Obviously there'll be some fuelsavings versus a 9 liter from
(06:33):
the traditional way.
So that could be prettyexciting for different customers
where they can kind of stepdown in displacement size but
not really lose any of theperformance and power.
Christoph Horn (06:42):
That's right, and you're going to gain some
weights or you're going tobenefit from the weight savings
as well.
That's a good point.
Yes.
Jason Cuddy (06:48):
So then, with you know, as you mentioned the L9,
so obviously that istransitioning as well for 27.
What can we expect?
Christoph Horn (06:54):
Yeah, so the L9, there's twofold.
So we're going to straddlemedium duty and heavy duty here.
The new product is called theand it will replace both the L9
and the X12 come 2027.
Gotcha, right.
So there's going to be twohardware sets for the X10.
There's going to be theproductivity series hardware set
(07:16):
and there's going to be theperformance series hardware set,
gotcha.
So the productivity series ismore or less the L9 ratings from
the past and then theperformance ratings are the X12
ratings from the past.
And then where do we see theproduct fitting in?
You know we call it theworkhorse and it's really going
(07:41):
to take on that mantra, rightthe same as the L9.
So heavy vocational focus, youknow some P&D work, but
vocational transit bus, refusetruck, vac truck.
But then also with theperformance ratings, ratings are
going to go up to 450, 1650.
So also a capable engine in atractor application, especially
(08:05):
if we're thinking about weightsensitive day cab, day cab work.
Jason Cuddy (08:09):
It'll fit quite nicely in there as well that's
pretty impressive, yeah, becauseif you're kind of merging the
two into one, you got to kind ofcover all lines.
But that's good to know,because that's always.
You know people are concernedokay to you know the
displacement's coming down soI'm losing power, but you're
right up there almost with youknow where, where that size and
you know the 12 liters play inyeah, yeah and and then the the
product is it's already inproduction today globally.
Christoph Horn (08:31):
Okay, um, so, for those who aren't aware, all
of our engines for north americaare made in north america, so
the x10 will be made, just likethe l9 is today in rocky mount,
north carolina.
We north americanize it andit's currently in test and then,
once we go to full production,it'll be made in Rocky Mountain.
Jason Cuddy (08:48):
Nice.
And then I guess the last oneto talk about is kind of the
bread and butter Everyone goesto, it defaults to with you guys
, which is the X15.
Nomenclature is staying, butthere's still again for 27.
Are some changes?
Yeah?
Christoph Horn (09:01):
And before we talk about the product itself, I
think we should talk about thetiming and I alluded to it off
the top.
The plan was and I think anyonewho's in the heavy duty
industry likely aware certainlyyou're aware if you have someone
from Cummins that you work withthe plan was to launch that
(09:21):
product and bring the benefitsof that product to market in
2026.
We recently made some changesand decided, rather than
launching it in 2026, we wouldlaunch in 2027 along with the
other products that we'rebringing to market at that time.
And the reason for that, youknow, is twofold for the most
(09:41):
part.
One is, you know, economic.
You know the pressures continueto be applied with regards to
economic pressures and you knowyou just had James in, I'm sure
you talked about that, you knowhe can continue to have those
conversations with you he'sperfect for that but, yeah,
those are really disrupting thebuying cycle with regards to our
customers right now.
(10:01):
And the second is from aregulatory standpoint is from a
regulatory standpoint, 2027 isstill happening.
We're aware of that.
But what happened, and whatcustomers may not be aware, is
that a month ago, six weeks ago,donald Trump signed the CRA,
the Congressional Review Act,and what that did is it revoked
(10:23):
CARB mandates, specificallyOmnibus, which was a low NOx
rule for between now and 2027that CARB had implemented at 50
milligrams.
It also revoked advanced cleantruck, which was the mandate
that stated that OEMs anddealers had to sell a certain
(10:46):
percentage of zero emissionvehicles before they could
unlock internal combustiondiesel sales.
And then, thirdly, this wasn'tpart of CRA but CARB didn't
pursue advanced clean fleet,which was the mandate that they
were considering bringing aboutto ensure that fleets were
(11:08):
purchasing zero-emissionvehicles that they wanted to
operate and travel intoCalifornia.
So that decision and thatchange brought about the fact
that originally we were going tobe able to sell 200 milligram
trucks in 46 states.
With that change we're able tosell 200 milligram, or current
(11:31):
production, I should say engines, in 49 states, Gotcha, Every
state other than California.
So we really saw a decrease inthe need or the demand for the
product.
So the decision was made andI'll reiterate it to continue
operating the current productthat we know today all the way
through to the end of 2026 andthen switch over to the 2027 x15
(11:57):
in 2027 gotcha, and yeah, those2027 epa guidelines are still
in place, despite everythingelse that has changed.
Jason Cuddy (12:04):
Yeah, you know, stuff still keeps moving.
You know that's the, theunknown, but clearly the 27,
every oem is so invested thatyou know that's not going away.
Um, but then that's where Iguess the X-15, the first main
changeover, comes into play.
Christoph Horn (12:16):
Yes, yes, and I should just mention as well for
fleets, that we're lookingforward to the we called it the
pull ahead provision.
We are still making a limitedproduction of the product in Q4
of 2026.
So that's the 27 product will gointo limited production, but
during that time we'll still bemaking the 200 milligram product
(12:39):
as well, so there is going tobe a little bit available.
But by and large, 2026 will beall 200 milligram production.
Then, as you mentioned, 2027,the whole product range.
The diesel product range thenflips over um to to the products
that we were just discussinggotcha and then tied to that.
Jason Cuddy (12:57):
You guys have made some changes to that block as
well and kind of how itinteracts with not just diesel,
obviously yes, as you go forward, maybe explain a little bit of
what's sure that is yeah sure.
Christoph Horn (13:06):
So that's a.
We could do a whole podcast onthat true so the the,
specifically the x15 um it's.
It's been in global productionfor a number of years.
I believe we've got 58,000 ofthem globally produced and 7.3
billion miles on them.
(13:27):
But we first brought thatproduct to North America and
launched the natural gas enginein 2024.
So this will be the dieselvariant and it will replace the
current diesel product, asmentioned in 27.
And it is a new block designversus what we had before.
So the current product is alegacy product that's
(13:48):
essentially carried on since 98when we launched the Signature
600.
So, yeah, it's coming up for arefresh.
We've launched a Signature 600.
So, yeah, it's coming up for arefresh.
And, yeah, the new block islighter, significantly lighter
than the other product.
Just base engine alone.
Reduction of parasitic losseswe're anticipating to see about
a 4% fuel economy improvement,base engine alone.
(14:11):
And then also on top of that,we you know we bought meritor jv
with eaton, so we've got uhdriveline as well.
That we're that.
We're making uh additional uhfuel efficiency improvements to
uh.
We're probably gonna see aboutseven percent driveline related
improvement for 27.
So very significantimprovements.
(14:31):
And then everything that youknow, navistar and our oem
partners do with regards toaerodynamic would just be over
and above so, some reallysignificant savings that we're
going to see there with regardsto fuel economy improvements on
the X15.
Jason Cuddy (14:46):
Which is nice, because I know everyone's always
challenged with, especiallywhen you get to different EPA.
Bumps in the technologyObviously there's cost involved,
and it is what it is.
Bumps in the technologyObviously there's cost involved,
it is what it is, but it's niceto see to some aspect, although
, yes, there is a bit of a costincrease as we go into these new
technologies.
What it keeps doing, though, iscreating an offset of a cost
reduction in fuel savings, andyou're not talking small numbers
(15:06):
, you're saying potentially fiveto seven.
By having an all-in drivelinewith your engine paired with the
Endurant and with the Meritoraxles, and then, yeah, with the
OEM, has you know?
Then you take some weight outof the vehicle, you put on aero
and you match that up withtrailer packages, like you can
see significant fuel savings asyou roll into 27.
So, despite the uptick in, youknow capital costs of the
(15:29):
vehicle.
You know over the long term,you know it should be very
beneficial to most fleets.
Christoph Horn (15:33):
Yeah, and that's kind of how I mentioned.
You know we're delaying some ofthe benefits, unfortunately, of
the next generation product.
But you know, from an economicstandpoint, from a regulatory
standpoint, probably the rightdecision, and then you know
we'll eventually get there when2027 hits.
Jason Cuddy (15:53):
Yeah, and I think part of you know by keeping it
static up until 27,.
I know you know to your pointwe'd have Menzies in before
talking about.
You know what the year lookedlike and everyone you know.
Before the slowdown happened,everyone was predicting.
You know, this year intomid-december next year was your
big pre-buy.
Yeah, and no one's seen thatyet.
But you know this may also willhelp with this because
(16:16):
obviously if you're not doingkind of that mid cycle bump
halfway through next year,obviously the cost stays fairly
static.
Christoph Horn (16:20):
Yes.
Jason Cuddy (16:20):
Up until 27.
So that may help encourage thepre-buy to some extent as well,
potentially.
Christoph Horn (16:24):
Yeah, I think it depends a little bit on what
the freight market does.
But you know, from a commonsperspective, fleets certainly
have longer if they wish topurchase the current product
before going to the nextgeneration, 2027, I should say
X15.
Yeah, yeah, so it'll beinteresting.
Yeah.
Jason Cuddy (16:43):
There's definitely lots to look forward to.
But you know, that's why wewant to have you on, just kind
of get an overview of what'scoming down the pipe, right, so
people can start planning.
You're at, you know, as we'retalking now it's the middle of
the summer.
So planning you're at.
You know, as we're talking nowit's the middle of the summer.
So you know, fleets startputting together their budgets
and their numbers for 26, right.
So this is good, at least sothey know what the market looks
like for 26 and then obviously,what what's coming down for 27,
(17:04):
and they can, you know, planaccordingly of.
You know how much they want toget it now, before later.
And then, hey, maybe hold offand take advantage of, you know,
something like the x10 or youknow, or the b7.2, and that may
help take some fuel costs out.
This gives them a better way tokind of potentially manage
their fleet over the next coupleof years, given the technology
that's coming down the pipe.
Christoph Horn (17:22):
Yeah, I agree wholeheartedly, and I think this
wasn't an easy decision fromCummins.
We'd been looking at doing thatfor that other strategy for a
little while, but, um, it wasabout the last possible moment
that we could, that we couldmake this switch, even from,
like, a supply perspective.
Right, because you know we doneed to to plan ahead from that
(17:44):
regards.
And yeah, and then it's, it'sgoing to be the same.
Um, there, you go.
Jason Cuddy (17:50):
So we've got some stability in the market.
For now we do, yes, which isgreat.
Hey well, look, I appreciateyou coming on and sharing this
information.
It's always good to have youguys come in and kind of give us
a temperature check of theindustry what's happening
technology-wise, and you guyshave a lot going on, especially
coming for 27.
So I really appreciate yousharing that with us.
Christoph Horn (18:05):
Thanks, jason, appreciate it.
Thank you.
Jason Cuddy (18:15):
And that does conclude today's episode.
To catch past episodes, checkout
transportationexchangepodcastca.
Until next time, thanks forwatching.
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