Hyliion Holdings will pay General Electric Co. $37 million in cash and stock to buy technology for a 3D-printed generator for its Hypertruck that will run on a mix of low-carbon alternative fuels from natural gas to hydrogen and more than a dozen fuels others .
The fuel agnostic approach evolves from Hyliion’s natural gas generator that creates electricity for up to 75 miles on the Hypertruck ERX. The ERX begins fleet trials later this year and enters production in late 2023. Testing of the Karno Thypertruck begins in the next two quarters.
Hyliion (NASDAQ: HYLN ) has more than 190 orders and 2,000 non-binding reservations for the system. Hyliion installs ERX on Peterbilt Model 579 Class 8 tractors.
The company looked at several fuel-agnostic technologies. The generator will eventually evolve into a hydrogen-powered fuel cell to create electricity for moving goods over long distances.
Acquisition of Hyliion born of GE Aviation
The Karno generator grew out of GE Aviation’s long research and development investment in metal additive manufacturing. Hyliion will operate an office out of GE Aviation in Cincinnati when the deal closes. This is expected to happen in the fourth quarter.
“It started over a year ago when GE reached out and said this [Hypertruck] the technology you’re developing is appropriate if you want to use this Karno technology,” Hyliion founder and CEO Thomas Healy told FreightWaves. “We also looked at other fuel agnostic solutions and this one ranked head and shoulders above anything else we saw.”
“Originally the plan was more of a supply deal with GE,” he said. “As we started to see more and more of what the generator was capable of and the efficiency and benefits, we proactively reached out to GE and asked if there would be any interest in selling this to continue developing it within our company .”
GE (NYSE: GE ) continues to be the leading manufacturer of 3D printers for metal parts. Hyliion will buy additive manufacturing machinery from GE.
“What’s driving us is this innovative generator technology,” Healy said.
Past SPAC successes
With the acquisition, Hyliion becomes the second transportation startup that appears to have a bright future after going public through a merger with a special-purpose buyout company. Some cash-poor startups are looking for new money, merging or failing.
Another former SPAC, Nikola Corp., is paying $144 million in stock to buy SPAC-backed startup Romeo Power. This move ensures its supply of battery packs, critical to the production of electric trucks.
‘Back to the Future’ Technology?
The Karno generator can produce electricity from a mixture of fuels,” Healy said. It can run on up to 20 fuels in total – from diesel to gasoline to hydrogen. The thermal efficiency of the Karno is 59%, Healy said. The generator will cost more initially, but will create a strong return on investment for truck fleets that adopt it.
The cost of electricity produced is calculated at 7 cents per kilowatt hour. The national average is 12 cents.
“What we’re saying is we have this box, this generator, and you can throw any of these fuels into it and it will produce electricity in turn,” Healy said. “It’s really a design, a platform that can run on different fuels.
“It can actually handle fuel blends, so if somebody wants to combine one part natural gas, one part hydrogen, or one part diesel, one part jet fuel, one part gasoline, they’ll get it and it will fit properly inside the generator and produce electricity. So you can mix it together and it will work with it.”
Healy laughed when asked if Karno was comparable to the fictional debris-swallowing flux capacitor in the Back to the Future movie trilogy.
“We’re not dealing with science fiction here,” he said.
Other uses of power distribution
Karno technology could find uses outside of the truck, such as generating electricity to power charging stations located in truck fleets.
“We can remove these and we can be the source of the energy and we can generate the electricity on site at that facility,” Healy said. “We are not ready to say how his introduction would work. We’re saying there are other options than putting this on a truck.
“We know the customers very well in the trucking space,” he said. “And we know we can solve their problems, and that’s why we wanted to set that as an example.”
What about Hyliion’s partnership with Cummins?
Hyliion and engine maker Cummins Inc. recently announced a collaboration to certify Cummins’ 12-liter natural gas engine for the Hypertruck ERX. The automaker plans to offer fuel-agnostic versions of its 15-liter engine, starting with a natural gas variant in 2024.
“When Cummins says fuel agnostic, they’re saying they have one engine block and that block is universal for different fuels, whether it’s diesel. [or] natural gas,” Healy said. “The top end of the engine changes everything. The engines are fundamentally different.”
But the 15-liter Cummins natural gas engine will likely find its way into future Hypertruck variants, Mike Taylor, Cummins general manager of global powertrain integration, told FreightWaves.
That makes sense because the first dedicated production customer for the 15-liter natural gas engine is Paccar Inc., (NASDAQ: PCAR ) maker of Peterbilt and Kenworth brand trucks.
“We will evolve with the Cummins portfolio and work closely with them on engines to come,” Healy said. “And the 15-liter is on that road map.”
Cummins working with Hyliion on natural gas engine certification
Hybrid revenue light as Hyliion builds order books for Hypertruck ERX
Cummins to integrate Gatik’s autonomous driving technology into the advanced powertrain
Click for more FreightWaves articles by Alan Adler.