Fiat Favors Natural Gas to Hybrids or EVs

Fiat CEO Sergio Marchionne doesn't want to produce electric cars or hybrids as they present too many obstacles, with long recharge time for batteries being one of them. Instead, he'd rather put his money on natural gas-powered cars which provide a cheaper way to cut emissions.

"Natural gas is very suitable for the U.S., especially for public services and goods transportation, where vehicles are refueled from a central base," said Constantinos Vafidis, who is in charge of transmission and hybrid development for the Italian maker.

This could be a reasonable explanation why Fiat wants to target the commercial vehicle segment. Having complete control of the Chrysler and Dodge brands, the Italian automaker separated Ram into a standalone truck division. The range could include various vans based Fiat or Iveco platforms.

With its low production, transport and distribution costs, natural gas seems like the ideal solution for fleet operators. It's currently priced at about $1 less than a gallon of gasoline, and the additional cost for an engine running on natural gas is just $3,000 as compared to $3,300 for diesels and an overwhelming $8,000 for hybrids.

Thanks to reduced production costs and the US being the world's largest supplier of natural gas, Fiat could have a great advantage in the eco-friendly niche. The company is Europe's market leader in methane powered cars, delivering 127,000 units last year.

The only thing left for Fiat to do now is to convince government agencies and corporate fleets that natural gas is a better option, as the infrastructure for natural gas delivery is seriously underdeveloped at the moment. There are only 1,300 stations providing natural gas for 110,000 vehicles, compared to 160,000 stations selling conventional fuels.