Volkswagen has taken a sharp right turn from a diesel-heavy lineup, and is even drastically curtailing its import of diesels into the U.S. The automakers’ diesel emissions scandal is still simmering, and Volkswagen will display a new electric car—reportedly with 310 miles of range (250 in the U.S. cycle)—at the upcoming Paris Motor Show. The company will release 30 electric cars across its brands (including Audi and Porsche) by 2025, it says.
Fuel-cell cars are electric cars, and some of those new models are likely to be powered by hydrogen. Volkswagen is working on fuel-cell drivetrains in partnership with Canada’s Ballard Power Systems, a powerhouse player in the 1990s that lately has had a low profile in the auto market. But now that’s changing.
Volkswagen bought Ballard fuel-cell patents (which originated at United Technologies) two years ago, and entered into an engineering services contract that runs until 2019, with extensions possible. This week, VW and Audi (which is taking the lead with fuel cells in the VW Group) said they were “accelerating certain key development activities” and said it was also stepping up the transition to series production of a fuel-cell vehicle. The so-called Hy-Motion program is aimed at a next-generation fuel-cell stack.
“We see our future as including electric powertrains, both battery and fuel-cell vehicles,” said Dr. Petra Hackenberg-Wiedl, head of the fuel-cell office at VW and Audi. Audi has shown both the Q6 h-tron (in Detroit earlier this year) and the A7 h-tron e-quattro concept (in Los Angeles in 2014).
Guy McAree, director of investor relations at Ballard, said that the company is also partnered with three other automakers that it won’t name, and is doing work in the aerospace and rail space.
“We’re well positioned in the automotive field if and when there is a high-volume vehicle rollout,” McAree said. “We are in the middle of our program with VW right now, and we have good margins as a supplier.” He described the company’s role as a technology consultant for the auto companies, offering a bundle that includes access to Ballard’s scientists and existing intellectual property.
One of Ballard’s biggest fuel-cell vehicle projects hasn’t gotten much traction in the press. The company signed a deal in July with China’s Zhongshan Broad-Ocean Motor to supply the fuel cells for 10,000 Chinese delivery vehicles that will be built over a period of several years.
According to McAree, the fuel-cell trucks will supply Broad-Ocean’s commercial leasing business, which already includes 2,700 battery electric vehicles. “The way it will work is that we will be a minority partner in a Chinese joint venture that will manufacture the fuel cell stacks in China,” McAree said. “We will retain intellectual property ownership of the membrane electrode assemblies (MEA), build them in Canada and ship them to China.”
Broad-Ocean, which produces 50 million motors (for electric vehicles and other purposes) annually for a variety of clients, has announced in August that it had taken an ownership stake in Ballard, investing $28.3 million.
McAree said Ballard sees a bright future supplying the Chinese market, especially to power transit buses—a huge business there. “Buses and commercial vehicles for China will become a huge business for us,” he said.
In the late 1990s, when Ballard was a partner with multiple automakers, including Ford and Daimler—which announced that it would produce 100,000 fuel-cell vehicles by 2004—the company’s stock soared to $115 a share. McAree said that price was unrealistically high at the time, since the markets were only speculative. But he adds that Ballard’s stock (at under $3 a share) is grossly underpriced now, since the company is making “real products for real customers.”