Foreign giants begin to "encircle" China's hydrogen fuel cell market

Europe is now busy catching up with electrification and developing the electric vehicle industry. Volkswagen and Mercedes-Benz have both announced that they will temporarily "give up" on hydrogen fuel cell vehicles, which require huge investments and are difficult to get returns in the short term . Although Japan and South Korea are concerned about the hydrogen fuel cell vehicle industry, their scale is limited after all, and the market pie is small. The North American market is "looking at the long term" for hydrogen fuel cells and the hydrogen energy industry.

Globally, no country is more concerned about the development of hydrogen fuel cells and the hydrogen energy industry than China. In 2019, the development of the hydrogen energy industry appeared in the government work report, and then policies supporting the development of the hydrogen fuel cell vehicle industry emerged from the central to local levels.

Faced with the huge temptation of the Chinese market, global hydrogen fuel cell parts and vehicle manufacturers have "encircled" the Chinese market, hoping to cut the tempting big cake here.

1. Japan’s “steady and steady” forces 

On June 5, Toyota Motor announced that it had signed an agreement with SinoHytec, FAW, BAIC, GAC, Dongfeng Motor and other five companies in Beijing to jointly establish "Joint Fuel Cell System Research and Development (Beijing) Co., Ltd." to carry out research and development work for commercial vehicle fuel cell systems. Toyota Motor invested 65%, SinoHytec invested 15%, and the other four automakers invested 5% each.

It is understood that the new company will develop competitive fuel cell systems and carry out a series of hydrogen fuel cell commercial vehicle technology research and development work in a one-stop manner, including "FC stack and other component technologies", "FC system control technologies" and "vehicle mounting technologies" to meet the needs of the Chinese market.

In terms of investment ratio, Toyota Motor will occupy a dominant position, followed by SinoHytec. The other four automakers are more likely to cooperate in the application of hydrogen fuel cell related technologies and products based on Toyota and SinoHytec.

As the pioneer of global hydrogen fuel cell vehicle research and development, Toyota has mature experience and extensive technical accumulation in hydrogen fuel cell vehicle technology. Previously, it has been promoting the promotion and application of hydrogen fuel cell vehicles in the Japanese market and has also achieved some success in the European and American markets, but there has been no "big waves".

The Chinese government's emphasis on hydrogen fuel cells and the hydrogen energy industry seems to have found an opportunity for Toyota, which has long been unsuccessful in the hydrogen fuel field.

In fact, Toyota has already started its hydrogen energy layout in China.

As early as 2017, Toyota built a hydrogen refueling station and conducted trials at its R&D center in Changshu, Jiangsu, China.

In May 2018, Toyota Motor also specially invited relevant Chinese government officials to visit its hydrogen fuel cell production plant in Japan.

In the same year, Toyota Motor also reached a cooperation intention with BAIC Foton and SinoHytec to jointly launch hydrogen fuel cell buses: the three parties intend to equip the hydrogen fuel cell buses produced and sold by BAIC Foton with SinoHytec's hydrogen fuel cell power system using Toyota's hydrogen fuel cell stack and other components, and the three parties jointly build hydrogen fuel cell buses. It is reported that hydrogen fuel cell vehicles equipped with this system will be put into mass production in 2021 and serve the 2022 Winter Olympics.

In July 2019, Toyota Motor announced that it had reached a consensus with FAW Group, Suzhou King Long and Shanghai Reshape Energy Technology Co., Ltd. to equip hydrogen fuel cell (FC) buses produced and sold by FAW Group and Suzhou King Long with Shanghai Reshape FC systems using Toyota FC stacks and other components. Toyota hopes to promote the application and popularization of hydrogen fuel cell vehicles in China by cooperating with more Chinese commercial vehicle companies.

In March this year, Toyota Motor announced that it would invest $1.22 billion to build a new energy vehicle factory in Tianjin in cooperation with its Chinese partner, FAW. The factory is expected to produce 200,000 pure electric, plug-in hybrid and fuel cell vehicles annually. According to the Tianjin Municipal Government's "Tianjin Hydrogen Energy Industry Development Action Plan (2019-2022)" (Draft for Comments) issued in 2019, "We must vigorously promote the development of Tianjin's hydrogen fuel cell vehicle industry and encourage FAW Toyota to introduce internationally advanced hydrogen fuel cell vehicle models." It is speculated that this factory may be an important production base for Toyota's hydrogen fuel cell vehicles in China.

It is obvious that Toyota is actively seizing the hydrogen fuel cell vehicle opportunities in the Chinese market.

It is worth mentioning that Toyota's hydrogen fuel cell layout in China is still steady and cautious, and it is establishing joint ventures or R&D cooperation with Chinese companies to promote its layout in China.

2 Korean companies "grabbing the market"  

South Korea's efforts in hydrogen energy layout should not be underestimated. Faced with the huge cake of the Chinese market, South Korean companies that are good at grabbing the market will naturally not sit idly by.

Data shows that in 2019, South Korea's hydrogen fuel cell vehicle sales have surpassed Japan, ranking first in the world. Matching the shipments of hydrogen fuel cell vehicles is the shipment of hydrogen fuel cells. It is reported that in 2019, South Korea's hydrogen fuel cell shipments were 408MW, exceeding the United States' 382MW and Japan's 245MW, while China's hydrogen fuel cell shipments were 128MW.

As the leader in the field of hydrogen fuel cell vehicles in South Korea, Hyundai Motor has long coveted the Chinese market.

However, unlike Japanese companies that are good at taking steady steps, Hyundai seems to prefer to go it alone in its layout in China.

According to Battery China, Sichuan Hyundai completed the shareholding change in February this year. After the change, South Korea's Hyundai Motor became the only major shareholder of Sichuan Hyundai, holding 100% of the shares. At this point, Sichuan Hyundai changed to a wholly foreign-owned company, and also became the first wholly foreign-owned commercial vehicle brand in China.

In January this year, Hyundai Motor Co., Ltd. Vice President Lee In-chul said that Hyundai Motor will produce hydrogen fuel cell vehicles at its Sichuan plant in China, conduct localized research and development, deepen resource complementarity with Chinese partners in hydrogen fuel, and operate and implement it through a leasing model. According to the plan, the Sichuan plant will initially produce hydrogen fuel cell commercial vehicles, and may also launch passenger vehicles in the future.

In short, the Sichuan plant will be an important hydrogen fuel cell production plant for Hyundai Motor in China, and will also be a bridgehead for it to develop the Chinese hydrogen fuel cell vehicle market.

Hyundai and Toyota are the current global leaders in hydrogen fuel cell vehicles, and both have strong strength in hydrogen fuel cell technology. Both parties have made layouts in China, which will usher in a new round of cooperation and competition in my country's hydrogen fuel cell vehicle industry chain.

3 Parts companies also join the "melee"  

"To understand the Chinese market, we must first pay attention to its scale," said Kevin MacArthur, Chairman and CEO of Ballard Power Systems, a global leader in fuel cells. China's emphasis on the fuel cell industry has also attracted Ballard's great interest.

According to Battery China, Ballard currently has several joint ventures or cooperative enterprises in China engaged in hydrogen fuel cell market development and other businesses. In 2015, the company signed a final license agreement and supply agreement worth 10 million Canadian dollars with Nantong Zehe New Energy Technology Co., Ltd. and Guangdong Hongyun Hydrogen Energy Technology Co., Ltd. to provide fuel cell power products and technical solutions for the first batch of 33 fuel cell-powered buses deployed in two cities in China.

In 2017, Ballard also established a joint venture with Guangdong Guohong Hydrogen Energy Technology Co., Ltd., Guangdong Synergy Hydrogen Energy Technology Co., Ltd., in which Ballard holds a 10% stake. The joint venture mainly produces fuel cell stacks for fuel cell engines.

Due to its leading edge in technology, Ballard has also been favored by many Chinese companies. In August 2018, Weichai Power and Ballard signed a strategic cooperation agreement. Among them, Weichai Power plans to invest US$163 million to subscribe to 19.9% ​​of Ballard's shares and become Ballard's largest shareholder. At the same time, the two parties will establish a joint venture in China to jointly develop the next-generation proton exchange membrane fuel cell stack suitable for the Chinese market, as well as the next-generation fuel cell modules for buses, commercial trucks and forklifts.

Ballard is just a microcosm of fuel cell vehicle parts companies entering China. The Chinese government's strong support for the hydrogen fuel cell industry has attracted companies from all links of the industry chain to set up in China. In recent years, fuel cell industry chain companies including Bosch, Ceres, SFC Energy, Nedstack, etc. have participated in China's hydrogen fuel cell industry, and related cooperation has been frequently reported in the news.

4 Will there be a similar whitelist for power batteries?  

In order to support the development and growth of local enterprises, my country introduced some policies in the early stage of the development of the electric vehicle industry, creating a short-term and critical environment for the growth and development of the local power battery industry. The purpose is to make the local battery industry bigger, stronger and better. Of course, under the influence of this policy, domestic battery manufacturers have lived up to expectations and have now become one of the world's power battery powers.