) has introduced its Tier 4 Final/Stage IV engine emissions
strategy for its AGCO POWER diesel engines. Tier 4 Final/Stage IV
will provide the farmers with an efficient technology to reduce
nitrogen oxide (NOx) and particulate matter (PM) emission from
AGCO CORP (AGCO): Free Stock Analysis Report
ASTEC INDS INC (ASTE): Free Stock Analysis
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The U.S. Environmental Protection Agency (EPA) started to enforce
limits on diesel exhaust emissions from nonroad diesel engines in
1996 and stationary diesel-engine generator sets in 2006. These
regulations were implemented in a series of steps called Tier
levels. Eventually, the regulations put into effect more stringent
limitations on NOx, PM, carbon monoxide (CO) and non-methane
In response, the engine manufacturers brought forth innovative
designs and sophisticated engine control systems to comply with the
successive tier levels. All major generator set manufacturers now
provide technologies that meet the Tier 2, Tier 3 or Tier 4 Interim
standards in various horsepower categories.
The Tier requirements have been implemented for over an 18-year
period that will end in 2015 with Tier 4 Final. The big move
towards emission reduction began in 2011 with Tier 4 Interim and is
due to conclude in 2014 and 2015 with Tier 4 final standards.
Diesel emissions have been reduced successfully with the
introduction of these regulations. It is further expected that NOx
and PM emissions from diesel engines will be diminished by about
99% by 2014 with the introduction of Tier 4 Final.
The major technologies that are used in diesel engine generators to
meet Tier 4 regulations include Selective Catalytic Reduction
(SCR), Diesel Particulate Filter (DPR) and Exhaust Gas
AGCO will be using its e3 SCR technology in AGCO POWER engines to
deal with the requirements of Tier 4 Final/Stage IV engine. Its
power engines will function effortlessly delivering total fluid
economy (diesel fuel and DEF), either meeting or exceeding the same
fluid consumption levels as in AGCO's Tier 4 Interim/Stage IIIb
With the introduction of Tier 4 Final engines, customers will get
what exactly modern agriculture demands - emission efficient, cost
efficient as well as reliable performance. Apart from AGCO,
Astec Industries Inc.
) is also investing significantly to redesign its engine models
from Tier 3 to Tier 4 standards.
AGCO retains a short-term Zacks #3 (Hold) Rank. We have a long-term
Outperform recommendation on the stock.