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GM, Honda Launch Fuel Cell Partnership

Paul Eisenstein, CNBC Contributor
Tuesday, 2 Jul 2013 | 9:00 AM ET
GM's Chevrolet Equinox
Source: Chevrolet
GM's Chevrolet Equinox

General Motors and Honda plan to team up in an effort to bring zero-emission hydrogen fuel-cell technology to the mass market by the end of the decade, the makers formally announced Tuesday morning.

Both GM and Honda have already begun fielding small test fleets of hydrogen-powered vehicles—as have a number of competitors including Toyota and Mercedes-Benz—but the goal of the new effort is to help solve resolving technical hurdles while driving costs down to mass-market levels. The makers also hope that by making a serious commitment to fuel cell technology they will encourage the energy industry to expand the availability of hydrogen, something essential to encourage consumer acceptance.

"The widespread use of future fuel cell vehicles requires a significant advance in cost reduction…and in the refueling infrastructure that will support them," Tetsuo Iwamura, president of American Honda Motor Co., was expected to say according to remarks prepared for a Tuesday news conference. "Two companies can do more together than the simple sum of our individual efforts."

The Honda CVX Clarity
Source: Honda Motor Co.
The Honda CVX Clarity

Hydrogen is the lightest of all elements and it produces essentially no emissions when burned or used in a device called a fuel cell stack. The latter technology is what GM, Honda and most other automakers have been focusing on. The device brings hydrogen and oxygen from the atmosphere together in the presence of a platinum catalyst. The result is a steady flow of electric current, with water vapor going out the vehicle's tailpipe.

Experts like to describe a fuel cell as a "refillable battery" and, indeed, the electricity such a device produces can be used to power electric motors much like the many battery-electric vehicles beginning to roll into automotive showrooms in increasing numbers.

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Unlike batteries, however, a fuel cell vehicle's hydrogen tank can be refilled almost as quickly as a conventional gas tank. That is, of course, if there's a service station nearby. Unfortunately, there are just a handful open to consumer in the U.S., most of them—currently 10—in Southern California, where GM and Honda have both been fielding small fleets of test vehicles.

The two makers are hoping that by teaming up and assuring energy suppliers they're serious about mass production they can speed up the addition of new hydrogen pumps, California hoping to have as many as 100 locations available by the end of the decade.

While GM and Honda both know how to make fuel cells, they acknowledge that there is still plenty of work to be done to make the technology viable at a cost consumers will accept. Today's stacks—the equivalent of a gasoline vehicle's engine—need to be smaller, lighter, less expensive and easier to manufacture.

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The open-ended joint venture is unusual in its breadth, GM and Honda agreeing to share absolutely all their knowledge and patents involving hydrogen power," GM Vice Chairman Steve Girsky was expected to say.

"We'll achieve this goal through shared expertise, economies of scale and common sourcing strategies," said the prepared remarks for the former Wall Street analyst. "We're talking about a complete sharing of all our respective intellectual properties on the subject."

Added a senior insider at one of the new partners who was not allowed to discuss the venture publicly. "You can't hold something back. Either we win together or we don't win at all."

The likely result, company sources agreed, will be a fuel cell stack that they can share by the end of the decade. While the venture is currently limited to the research level, there appears to be support for jointly manufacturing the eventual technology to further reduce costs.

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It remains anyone's guess how quickly fuel cell vehicles can be ready for prime time. At one point, GM's former Chairman Rick Wagoner had hoped to be in widespread production by the middle of this decade.

Fuel cell technology gained significant momentum during the years around the end of the last Millennium. But due to the seemingly endless hurdles, the technology lost momentum in favor of battery power. Now that electrification is losing voltage there's renewed interest in hydrogen. Steven Chu, outgoing Obama Administration Energy Secretary lately has been steering government support back to fuel cell research after curbing it during the president's first term.

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Nonetheless, a growing number of automakers have been amping up their hydrogen programs of late. Toyota is showing off a prototype fuel-cell vehicle at the 2013 Ideas Festival and promises to have a hydrogen car on the market by the 2015 model-year. Mercedes is fleet testing its F-Cell model in California, and Hyundai also has expressed plans to market a fuel cell model in the near future.

To get there, a growing number of makers are launching partnerships they hope will lower costs, speed up development and overcome the technical obstacles to mass market acceptance.

-By CNBC Contributor Paul Eisenstein; Follow him on Twitter @DetroitBureau

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