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Flexible Fuel Vehicles A Pathway for the Future

Flexible Fuel Vehicles A Pathway for the Future. Overview. A Pathway for Today and Tomorrow: E85 The Auto Industry’s Commitment Infrastructure – Midwest Corridor Ford’s Flexible Fuel Vehicles & Features The Role of Stakeholders: An Integrated Approach Final Thoughts on E85.

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Flexible Fuel Vehicles A Pathway for the Future

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  1. Flexible Fuel VehiclesA Pathway for the Future

  2. Overview • A Pathway for Today and Tomorrow: E85 • The Auto Industry’s Commitment • Infrastructure – Midwest Corridor • Ford’s Flexible Fuel Vehicles & Features • The Role of Stakeholders: An Integrated Approach • Final Thoughts on E85

  3. A Pathway for Today and Tomorrow: E85 • Ford supports a broad range of renewable fuels • All Ford gasoline vehicles can run on up to E10 • All Ford diesels can operate on to B5 bio-diesel • Ethanol has been a transportation alternative fuel for more than 10 years • Vision must move from fuel blends to a true fuel choice – E85 • Ethanol has the potential to provide customers with a viable fuel choice and help dampen gasoline pricing volatility • Public policies must support: • Convenient customer access • Distribution that enables customer value – fuel price differential is key • Ethanol feedstock diversity (e.g., cellulosic sources) will play a pivotal role in the vision to move production volumes from blends to support E85 growth

  4. Making a Real Impact • Over the last decade, Ford has placed more than 2 million E85 flexible fuel vehicles on America’s roads • Combined, U.S. automakers have produced a total of nearly 6 millionE85 FFVs • In July, Ford, GM, and DaimlerChrysler voluntarily committed to doubling the production of FFVs by 2010 • Combined yield approximately 10 millionFFVs in service by 2010 • Infrastructure is lagging to support 10 million E85 vehicles: • Industry would need 18,000 pumps if consumers used E85 50% of the time 1,100 Existing E85 Pumps 9,000 25% use • Expanded commitment to 50% of vehicle production by 2012 if fuel infrastructure exists to support

  5. Case Study: The Midwest Ethanol CorridorWhat We Have Learned • The nation’s first “ethanol corridor” was launched in June – involving VeraSun (IL), MFA Oil (MO) and Ford • Adds about 50 new sources of E85 and allows drivers to travel from Chicago to Kansas City using only E85 • Both VeraSun and MFA established term contracts with retailers to support competitive E85 pricing – necessary to address near-term ethanol volatility in pricing and supply • MFA retailers have maintained 20% pricing differential (February 2007 @ $1.65 E85 vs. $2.05 gasoline) • Customer base is growing and sustainable (value pricing supports repeat customers) • Ford is sending out notices to all FFV owners in Missouri to enhance awareness and has billboard advertisements along the route in Illinois • Consumer awareness of E85/FFV issues is extremely low • Mis-fueling is a key concern and requires ongoing messaging • Coordination in vision among stakeholders – production, distribution and retail – is critical to deliver customer value • Disparity in retail pricing objectives must be addressed

  6. Midwest Ethanol Corridor – 50+ New Sources of E85

  7. E85 Availability is Midwest CenteredEnabling Energy Security Initiatives at the State Level 1100+ Stations

  8. Midwest Ethanol Corridor Billboards

  9. FFVs Provide Fueling Options: They operate on gasoline, E85 or any blend in between Upgraded FFV Fuel System Components: Low Permeability Fuel Tank, Higher Flow Fuel Pump, Fuel Delivery Lines Upgraded FFV Engine Components: Valves and Valve Seats, Spark Plugs, Fuel Injectors, Cylinder Head Gaskets Development/certification testing more than doubled: Evaporative testing more stringent and difficult Engine Control Computer: Adjusts engine calibration for proper performance and to meet emission requirements on all fuel blends Ford Flexible Fuel Vehicle FeaturesIncremental and Program Costs Ford, GM and DaimlerChrysler commitment to double FFV production represents more than $200 million in incremental costs per year.

  10. Advanced Vehicle Technologies • Ford Escape Hybrid E85 • Ford will deliver 20 ethanol-fueled hybrids this spring for use in fleets in six states • Consumer testing to gather data on functionality, durability, emissions and software applications • Other Potential E85 Applications • Ford's new TwinForce engine using direct injection technology and turbocharging delivers V-8 power with enhanced fuel economy. Flex-fuel capable version highlighted on Lincoln concept vehicle. • Ford and Ethanol Boosting Systems, LLC, researching direct injection fuel systems • Studies to define E85 blend specification and in-vehicle performance • Ethanol-to-hydrogen conversions to demonstrate feedstock diversity for H2ICE and fuel cell applications

  11. The Role of Stakeholders:An Integrated Approach

  12. Final Thoughts – E85 • Energy security is a critical issue for the U.S. and states can lead the way through vision/policy • State renewable fuel initiatives can have an impact now on reducing oil consumption • Blends play a role but E85 is a pathway for increased energy security for today and tomorrow • Chicken and Egg – demand for FFVs will continue to wane unless customers see: • Value pricing for E85 (20% cost differential at the pump) • Growing access/convenience • Ford is poised for growth and building the foundation for a real transition – E85 fuel production/distribution breakthroughs are needed

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