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Corning continues to look ahead: company stays focused on emissions control development and long-term growth of heavy-duty diesel market.

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As Corning moves forward in what all will agree has been a less than stellar year, it has focused on technology advancements and the continued relationships it has established with OEMs and engine manufacturers. While the economy has lagged, the deadlines for emissions regulations have continued to loom, allowing no slowdown in the development, planning and implementation of Corning's emissions control systems.

"We are seeing about a 20% downturn this year versus 2008, which was actually down from 2007," said Thomas Hinman, senior vice president of Coming Environmental Technologies. "For more than a year, the heavy-duty industry has been running along what appears to be a bottom. We certainly never saw any significant upturn for the heavy-duty on-road business after the 2006 pre-buy. And, the effects of that carried into 2007.

"The market is very much suffering from the economic impact of this global recession. The industry has excess truck capacity, and we hear reports of unused trucks being parked. From our standpoint, even as the economy begins to improve, the demand for new trucks with new engines will be somewhat delayed simply because of the amount of available truck capacity that is out there.

"Our view is yes, it will turn up, but it's likely to be late in 2010 rather than earlier and could carry into 2011. We're in this for the long haul and that conviction is not wavering. We're doing things to manage through this downturn so that we're ready for the upturn."

While Corning has felt the impact of 2009, it has stayed the course by continuing to enhance relationships with OEMs and engine manufacturers and developing new emissions control products. Although the economy is lagging, the deadline for emissions regulations are ahead, and Coming is continuing to design and manufacture its emissions control technologies to help customers meet the tightening regulation deadlines.

Products such as Corning's DuraTrap AT filters were initially developed for automotive vehicles and are now making their way into on- and off-highway trucks and construction vehicles.

"There is a continued pull for new technology for the 2010 regulations and for the off-road regulations," said Hinman. "We continue to support work with our customers by investing significantly in new products and in new technologies.

"Even in the throes of this recession, we've taken our aluminum titanate, which is a unique Corning material for diesel particulate filters, and we've extended that technology into the heavy-duty on-road space for 2010. It offers a higher heat capability for on-road engines while at the same time providing a monolithic product that can improve durability."

Development is also occurring on next-generation after treatment systems for Corning. The company is actively working with OEMs and engine manufacturers to develop emissions control technologies for the next wave of emissions regulations.

"We're looking at how to integrate the N[O.sub.x] control functionality onto the filters," said Hinman. "That drives a whole new level of demand for increased porosity in the filters. We are very active in a number of development programs with OEMs looking at next-generation filter technologies and anticipating the potential integration there."

Like most companies, Coming took early action to reduce the impact of the recession by working through inventory and looking internally at cost structure and production capacity, both long-and near-term.

"Last quarter, we restructured our operations to align our cost structure with the new market realities," said Hinman. "We believe the recession in heavy-duty will likely continue well into next year. It could be late 2010 before we see a substantial improvement in the economic environment that drives new truck production.

"We initially worked through the early days of the recession by taking more inventory level shutdowns," said Hinman. "We implemented an initial staffing reduction in late first quarter. We have now adjusted our overall cost structure to reflect the projected business levels for the next 12 to 18 months."

While production is at a reduced level for Coming, engineering activity remains high, as Coming remains positive on the potential for the heavy-duty diesel market.

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"Our strategy for this business is to collaborate with our OEM customers, whether on-road or off-road, and work on their next-generation technology needs for emissions control," said Hinman. "We work very diligently to have direct access to the engine manufacturers to talk about their longer term technology needs and work with them to innovate around those needs.

"We believe we're supplying products that are positioned three to five years out for when they need them. We see a lot of good work being done to prove out system technologies even as the economy is soft. We're optimistic about the potential that this business represents going forward.

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"The long-term indicators are good for this business and that's how we look at this opportunity. When we step up and look over the hills, we see a good future but we know we have to ride out the storm."

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Title Annotation:TECHNOLOGY OF CLEAN AIR
Author:Geske, Dawn M.
Publication:Diesel Progress North American Edition
Date:Dec 1, 2009
Words:837
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