SAN JOSE, Calif. — Nestled among flat-roofed Silicon Valley startups in an unassuming tree-lined neighborhood, Tula Technology is perfecting its Dynamic Skip Fire engine controls for diesel and electric truck powertrains that could clear expected 2027 regulatory emissions hurdles — and save a lot of fuel in the process.
The private company doesn’t care if you’ve never heard of it as long as automotive and commercial vehicle manufacturers have. Through regular appearances at industry confabs, sharing of technical papers based on more than 400 patents and collaborations under nondisclosure agreements with companies around the world, Tula is well known.
It has a LinkedIn page with about 2,500 followers. No Facebook or Twitter. But it uses China-based messaging service WeChat regularly.
“Obviously, we’re not a consumer product. So, it’s not important that we’re all over social media, but it’s very important that the industry knows us,” CEO Scott Bailey told FreightWaves in an interview. Office cubicles are vacant. Most of Tula’s 62 engineers and software developers are working from home during the pandemic. Testing labs are still occupied.
Based on an internal chart showing dozens of unnamed companies at varied states of engagement, Tula’s potential book of business appears huge. The company could be a savior for heavy-duty trucking and other commercial vehicle makers as federal requirements for reducing nitrogen oxide (NOx) pollution become law here and in other countries..
“Everybody’s working under these same expectations that the regulation that’s supposedly going to come out here is going to be the same as the California low-NOx omnibus,” said Steve Carlson, Tula’s vice president of business development and marketing. “If it is, then the phone starts ringing even more than it is now.”
A big score …
Dynamic Skip Fire (DSF) is integrated into engine and motor controls, where it identifies the sweet spot of efficiency for gasoline, diesel and electric powertrains. In internal combustion engines, it makes the most of firing cylinders — as few as one all the way to an engine’s total — to precisely match the driver’s demand for torque while avoiding noise, vibration and engine harshness.
Tula’s first public commercial success — applying DSF to a high-volume General Motors V8 gasoline engine — generates a stream of royalties. The technology debuted in 2019, creating up to 15% fuel savings while reducing carbon dioxide (CO2) emissions.
GM (NYSE: GM) has 1.5 million DSF-equipped vehicles on the road. From initiation in 2013 to production took five years — about the same as it takes to develop a new engine. During that time, Tula founder and chief inventor Adya Tripathi saw the potential to apply DSF to diesel engines and electric motors. It may have saved the company.
“He showed up with Dynamic Motor Drive,” said John Fuerst, Tula senior vice president of engineering. “It wasn’t like he got sent away to come up with the next chapter.”
Tripathi, a serial entrepreneur, named the company he founded in 2008 for the village where he grew up in India. Tula is also roughly translated Sanskrit for the word balance, consistent with Tula’s goal of creating a technological balance of efficiency, emissions and sustainability.
With a digital signal processing background, Tripathi worked for Hewlett-Packard, IBM and National Semiconductor. A digital audio amplification chip he created is included in a 2009 compilation by the Institute of Electrical and Electronic Engineers as one of the “25 Microchips that Shook the World.”
In 2015, Tula worked on DSF for small passenger car gasoline engines with former auto supply giant Delphi, since split into Aptiv and Delphi Technologies, the latter being acquired by BorgWarner Inc. for $3.3 billion in 2020.
… then a shock
As it was reaching the finish line with GM in 2018 on a replacement for the automaker’s less efficient and clunkier system that deactivated four of eight cylinders at a time, Tula absorbed an electric shock: the auto industry suddenly embraced battery power in place of internal combustion engines.
As one automaker after another bailed, contagion followed.
“Activity ground to a halt when the industry said, ‘Wait a moment. We have to put all our eggs in the electric propulsion basket.’” Bailey said. “We had some very lucrative and big programs just stop.”
DSF discussions went underground. Projects were more shelved than canceled. “Talking about internal combustion was taboo, even though some of that stuff was still going on and there were OEMs still talking to us about DSF; it was top secret,” Fuerst said.
Executing a diesel pivot
So, Tula turned to focus first on diesel applications for DSF. Gasoline is spark-ignited and diesel is compression-ignited, but both are internal combustion engines.
“You learn the word pivot pretty quickly when you live in Silicon Valley,” said Bailey, 67, whom Tripathi recruited after Bailey retired from Delphi in 2010. Bailey recruited Fuerst, 61, to join Tula in 2016.
In 2019, Tula began a two-year collaboration with Cummins Inc. on a proof-of-concept X15 diesel engine that cut NOx emissions by 74% and CO2 by 5%. The engine is used in on-and-off highway trucks, buses, earth movers and beyond. Early efforts on DMD started around the same time.
“As we continue to reduce emissions in our products, diesel Dynamic Skip Fire is one effective strategy that can be useful in concert with other tools to reduce emissions,” Lisa Farrell, director of Cummins Accelerated Technology Center, told FreightWaves. “dDSF is one of many technologies we continue to evaluate for the future.”
Tula expects to announce its first contract for dDSF this year with production in 2025 or 2026. The process takes a long time because an advanced development program is just the beginning. Cylinder head redesign follows, then hardware validation and finally production.
‘Some real money’
Tula emphasizes the dual benefit of lower NOx and fuel savings, but NOx reduction is paramount because all truck makers will have to comply with regulations coming in the near future. There are other methods of reducing NOx but they burn more fuel.
“The typical Class 8 truck burns 20,000 gallons of fuel a year,” Bailey said. “You save them 3%, it’s some real money.”
Manufacturers also are demanding longer warranties, meaning the test and validation cycles carry extra weight.
“Whatever technology we put on the engines has to be really robust for an extended period of time,” Bailey said. “It makes us a little crazy. We understand the robustness has to be there. We just wish it didn’t take so long.”
Even if a manufacturer adopts dDSF, it will start with one engine program and add others later because of the complexity. Since truck orders historically rise in the year before major emission changes because of higher prices, Most fleets will opt for what’s least expensive — and legal — when it comes to emissions.
Tula has more than diesel engines in play.
“We have the little ‘d’ in the dDSF logo there, but there’s a fair amount of Dynamic Skip Fire in commercial vehicles that is not diesel. There’s methane and propane. Hydrogen is coming down the pike,” Fuerst said.
DMD, the pulsing of electric motors to operate at peak efficiency, will extend beyond traction motors for vehicles to drones and wind generators. The technology increases efficiency by 2 ½ to 5% while significantly reducing reliance on rare earth materials, which Tula projects could be the next headache for manufacturers struggling with an ongoing semiconductor shortage.
“Our founder started looking at the electric motor maps and saw, gee, these kind of look like combustion maps and there’s a sweet spot, and we ought to be able to take the same sweet spot concept and use it on an electric motor,” Bailey said. “There’s a common control philosophy that underpins DSF and DMD.”
Tripathi used the human heart and pulmonary system as a model for the electric pulsing.
“When you need more output, it basically just beats faster. The differential pressure in your heart doesn’t really change. It’s how often your heart beats,” Bailey said. “So, you exert yourself, you get stressed out. Each pump has optimal efficiency for your body, but you beat faster [and] slower, and you match the output needed.”
Tula today is more of a growth stage company than a startup. Venture capital heavyweights like Sequoia and Khosla Ventures along with GM Ventures, BorgWarner (NYSE: BWA) and most recently Franklin Templeton Funds have invested about $97 million over five rounds since 2008.
“We don’t need a cash influx. We’ve got patient investors,” Bailey said. “These guys have stayed with us from the beginning because they see the value of what’s being created here. The tricky piece is what’s the best way to monetize the value that’s being created.”
Scratch the special purpose acquisition company route. SPACs are known for raising big piles of cash, at least until the recent heavy scrutiny of how they operate. Tula talked with a few SPACs and saw no fit because it doesn’t need a multimillion-dollar factory or have other cash-intensive requirements. Its greatest need is to attract, retain and pay smart people.
For much the same reason, a traditional initial public offering and a potential pot of gold from selling shares holds little appeal because of the trade-offs that come with public ownership. “Now you want everybody to second guess everything you do,” Bailey said.
“For us, a more interesting exit would be a more traditional [merger] where a company could help us grow faster.”
What about Cummins (NYSE: CMI), which knows Tula and is in the third year of an ongoing collaboration that has generated more than 30 joint patents?
“We’ve got a great relationship with Cummins,” Bailey said. “Cummins is an ideal technical partner, but they aren’t necessarily an ideal owner. Cummins doesn’t care if DSF gets used around the world. Their interest is to have access to the technology. Our interest is to sell as broadly as we can, to Cummins and all their competitors.”