On December 29, 2011, the National Environmental Protection Department announced that starting from July 1, 2013, all production, import, sales, and registration of vehicles with compression-ignition engines must comply with the requirements of the National IV standard. For a time, issues affecting the implementation of National IV were widely discussed, and Adblue (urea solution), as the main solution for achieving National IV emissions -- the Selective Catalytic Reduction (SCR) post-treatment system's necessary consumable, its supply issue became one of the focuses of attention. For this reason, the editor interviewed relevant companies.
The postponement of National IV was expected and has little short-term impact
Mr. Luo Tong, Director of Domestic Sales and Technology at Yara Zhonghua, said, "Overall, (the postponement of the National IV timeline) has no effect on Yara Zhonghua's business (Adblue). From the perspective of market development, there must be a period after the policy is in place before the vehicle denitrification agent (Adblue) market can be widely used. We entered this market with full preparation for its development, implemented in stages. The delay was within our expectations."
Mr. Qin Jian, Operations Director of Kelausu, also stated that the postponement would have little short-term impact because the market had not yet started, and there was still a year and a half left. However, it would have a significant long-term impact, as there was still much work to be done in the next one and a half years, such as increasing production capacity, building channels, promoting low-temperature Adblue and solid urea. More importantly, due to the gradual clarity of the National IV standard's implementation despite repeated delays, companies in the industry gained some confidence, as if they "saw the light at the end of the tunnel."
Supply, technology, and channel distribution of urea will not be an issue
Industry insiders had previously raised concerns about the lack of urea refueling stations, and the journalist had also received similar requests for help.
On December 29, 2011, Mr. Wu from LG Group called the journalist to find a refueling point for the urea solution for five Yutong buses belonging to his company.
Mr. Luo Tong stated, "The lack of refueling stations is indeed a reality; after all, there are too few Euro IV vehicles currently, and the balance between input and output requires time. It’s like the chicken or egg dilemma." When discussing the construction of refueling stations, he mentioned that there are multiple ways to build them, including cooperation with gas stations. In Europe, Yara has experience in this area, whether investing in building stations ourselves or partnering with oil companies. Moreover, refueling stations are just one way to supply urea solutions. For large customers, such as commercial vehicle enterprises and fleets, dedicated refueling stations (points) can be constructed, with these points supplied regionally by specialized Adblue trucks. Currently, Yara has established good cooperative relationships with international commercial vehicle giants such as Volvo, Mercedes-Benz, MAN, and Scania. Recently, Yara International and Scania announced global cooperation on AdBlue supply, reportedly the first global agreement on the aftermarket between a heavy truck manufacturer and an AdBlue supplier.
Mr. Luo Tong emphasized that since most of the urea solution is water, the cost of long-distance transportation is high. Therefore, Yara Zhonghua has collaborated with Sinochem Group to layout new factories domestically. For more commercial vehicle users, 10L packaged small containers are very popular due to their convenience and ease of refueling, making it the world's largest supply method.
Kelausu has also done extensive work in the production, R&D, and sales network construction of urea solutions.
Mr. Qin Jian informed the reporter that Kelausu's annual production capacity of urea solution is 120,000 tons, with plans to increase to 1.6 million tons by July 1, 2013. Technologically, Kelausu has developed low-temperature urea and solid urea, with two products suitable for -25°C and -35°C environments, providing more options for National IV vehicles in extremely cold regions. Since 2010, Kelausu has successfully researched and developed four types of refueling equipment suitable for various urea solutions, gaining recognition from companies like FAW and Dongfeng Motor Corporation.
Additionally, Kelausu will vigorously expand its sales network channels, focusing equally on group customers and social channels. Kelausu has already supplied urea solutions to well-known automotive enterprises such as Yutong Buses and BAIC Group.
As a part of the Longpan Lubricants family, Sales Manager Chen Xiaoxing of Longpan Lubricants told the reporter that Kelausu's urea products can be sold through Longpan Lubricants' sales channels. Currently, there are 300~400 sales outlets nationwide, covering provincial capitals, and will continue to expand according to circumstances.
Hubei Jiangnan Dongfeng Special Purpose Vehicle Co., Ltd. is a designated production factory by the National Development and Reform Commission, the only fire truck production qualification factory in the capital of special purpose vehicles granted by the Fire Bureau of the Ministry of Public Security, and a supporting modification factory of Dongfeng Motor Corporation. Its main products include fire trucks, tow trucks, aerial work platforms, wing-opening box-type transport vehicles, water sprinklers, fuel tankers, chemical liquid transport vehicles, flatbed transport vehicles, mobile power vehicles, garbage trucks, and hundreds of other varieties. All models have been listed in the national announcement directory, obtaining ISO9001-2000 quality management system certification, and the products have passed CCC certification.
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