High Hopes — And Hurdles — For Hydrogen Cars

Automakers are gearing up for mass-market production of hydrogen-powered cars starting in 2015, but the fuel cell technology has plenty of skeptics, including President Obama.

Source: Chrysler.com Chrysler's ecoVoyager concept car unveiled at the Detroit Auto Show.The ecoVoyager mates an lithium-ion battery pack to an advanced hydrogen fuel cell, resulting in a vehicle with a range of more than 300 miles that emits nothing from the tailpipe but water vapor.

After being championed by former President George W. Bush as a pollution-free solution for weaning America off its dependence on foreign oil, the vehicles are in danger of losing research and development funding under the Obama administration, which argues that plug-in electric cars are a more practical bet.

However, major automakers and other proponents of hydrogen-fueled cars managed to thwart similar attempts to cut funding for programs for fuel-cell research in 2009 and hope to do so again.

Nevertheless, they're worried about the signal the Obama administration’s stance is sending to the marketplace and to investors about the vehicles, which create electric power from hydrogen and emit nothing but clean water from their tailpipes.

“We’re prepared to make thousands of these cars,” says Mike O’Brien, vice president of product planning at Hyundai Motor America. “But it really comes down to how many fuel stations there are at that point. It’s a chicken and egg story for us.”

Energy Secretary Steven Chu maintains that hydrogen fuel-cell vehicles need technological miracles too distant to warrant funding when electric cars are a far more promising near-term prospect to give American consumers an alternative to the roughly 230 million gas-guzzlers on the road.

Automakers, who have pumped billions of dollars into hydrogen technology, say Chu’s assessment is out of date and doesn’t reflect breakthroughs and developments that are dramatically bringing down costs.

Several automakers already have hydrogen-powered cars on the road, including the FCX Clarity, a make that Honda

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[HMC  Loading...      ()   ] leases to roughly 20 customers in Southern California.

Critics say the car, early iterations of which cost more than a million dollars each to build, shows the technology is too expensive.

Stephen Ellis, manager of fuel cell marketing for American Honda Motor Co., says that thinking is flawed.

“If we made the Honda Odyssey in these quantities, they would be $1 million vehicles,” says Ellis. “When we have a dedicated assembly line and we calculate with scale in 2015 to 2020, what the price will be then is what’s relevant.”

When the FCX Clarity initially revs up production for the mass market, it will likely be sold at luxury-car prices, says Ellis. “But we’re not going down a path that has some dead end. Every environmental vehicle we put on the road to date has had an incremental cost reduction.”

With production costs falling, the major remaining roadblock to large-scale production of fuel-cell vehicles is finding a cost-effective way to build a network of hydrogen fueling stations.

Shortly after becoming governor of California in 2003, Arnold Schwarzenegger pledged to build a “hydrogen highway” of as many as 200 fueling stations by 2010. To date, however, only a handful of stations have been built and they are mainly clustered around Los Angeles.

Tom Sullivan, an entrepreneur who hoped to build a similar hydrogen highway on the East Coast from Maine to Miami, put the brakes on his plan in the spring; he now plans a slow. limited roll out of station clusters in Connecticut, Washington, New York and Boston until demand picks up.

The 51-year-old founder of Lumber Liquidators isn’t sure he’ll ever make money on the investment. Even he has doubts that hydrogen-fueled cars will ever make it into mass-market production.