Fiat Chrysler Automobiles (FCA) is spending $40 million to convert its Detroit-based fleet of heavy-duty trucks from diesel to compressed natural gas (CNG).

Steve Beahm, FCA’s senior vice president of supply chain management, said moving to natural gas-powered trucks will provide both economical and environmental benefits.

“Our transition to CNG reflects the way FCA US attempts to balance our search for profitability with social responsibility and community development, including environmental stewardship,” he said. “This project was a win-win-win – it offered a solid business case, clear environmental benefits and an opportunity to invest in our Detroit facility and workforce.”

The bulk of the $40 million investment will be used to convert FCA’s fleet of 179 trucks, which are operated under FCA Transport Detroit to haul auto parts. A maintenance facility will receive a $1.8 million upgrade to handle the fleet, while an additional $5 is being spent on the “installation of the largest private CNG fueling station in North America,” said FCA.

By moving to natural gas, though, FCA is predicting it will reduce annual fuel costs by 35 percent.

“Prior to the changeover, the FCA Transport Detroit fleet used nearly 2.6 million gallons of diesel fuel per year while driving about 16 million miles to deliver parts to assembly plants from suppliers and FCA US component facilities,” the company said, adding, “Beyond cost savings, FCA Transport estimates the Detroit fleet’s transition to CNG will reduce CO2 emissions by more than 16,000 tons per year. This decrease is equivalent to the annual carbon dioxide emissions that come from burning more than 17 million pounds of coal, or the reduction of CO2 emissions from the annual energy use of nearly 1,500 homes.”

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Other companies converting their commercial truck fleets to CNG include UPS and Waste Management, while businesses such as Wal-Mart and Lowes are now asking their suppliers to use natural gas vehicles. Advocates for increasing the ratio of CNG trucks within a fleet often cite fuel savings as one of the top advantages. Critics say the savings are not quite what they seem, with a return on investment often not seen for four years.

“There’s not a huge savings today with natural gas,” said Jeff Shefchik. As president of Paper Transport Inc., Shefchik has converted about a fourth of his fleet of 430 trucks to CNG. Even so, Shefchik adds that his company was “content to invest in it because it’s going to grow over time.”