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Daimler AG, Volvo Group to form JV for large-scale production of fuel cells

The companies plan to form a 50/50 joint venture for development and large-scale production of fuel cells for heavy-duty vehicles.

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Daimler fuel cell electric vehicle

Assembly line for a fuel cell drive unit in Kirchheim-Nabern. The tightness of all the connections is checked once again for good measure. The circulation systems for the hydrogen, the air and the coolant are all checked. Source | Daimler

 

Daimler Truck AG (Stuttgart, Germany) and the Volvo Group (Gothenburg, Sweden) have signed what they report is a preliminary, non-binding agreement to establish a new joint venture to develop, produce and commercialize fuel cell systems for heavy-duty vehicle applications and other use cases. As part of the joint venture, Daimler will consolidate all its current fuel cell activities in the joint venture. The Volvo Group will acquire 50% in the joint venture for the sum of approximately €0.6 billion on a cash and debt-free basis.

According to the partners, in the context of the current economic downturn, cooperation has become even more necessary in order to meet Europe’s Green Deal objectives within a feasible time-frame. This includes aiming for sustainable transport and a carbon neutral Europe by 2050.

The goal is for both companies to offer heavy-duty vehicles with fuel cells for demanding long-haul applications in series production by the second half of the decade. Other automotive and non-automotive use cases will also be evaluated.

“Transport and logistics keep the world moving, and the need for transport will continue to grow. Truly CO2-neutral transport can be accomplished through electric drive trains with energy coming either from batteries or by converting hydrogen on board into electricity. For trucks to cope with heavy loads and long distances, fuel cells are one important answer and a technology where Daimler has built up significant expertise through its Mercedes-Benz fuel cell unit over the last two decades. This joint initiative with the Volvo Group is a milestone in bringing fuel cell-powered trucks and buses onto our roads,” says Martin Daum, chairman of the Board of Management Daimler Truck AG and member of the Board of Management of Daimler AG.

fuel cell electric vehicle

The PEM fuel cell is structured like a sandwich. In the center is a thin plastic film coated on both sides with a thin catalyst layer and a gas permeable electrode made of graphite paper. The membrane is surrounded by two bipolar plates into which gas ducts have been milled. Through these gas ducts flows hydrogen on the one side, and oxygen on the other. Several of these individual fuel cells can be stacked one behind the other to create a fuel cell stack. Source | Daimler

 

The Volvo Group and Daimler Truck AG will be 50/50 partners in the joint venture, which will operate as an independent and autonomous entity, with Daimler Truck AG and the Volvo Group continuing to be competitors in all other areas of business. Joining forces will decrease development costs for both companies and accelerate the market introduction of fuel cell systems in products used for heavy-duty transport and demanding long-haul applications.

To enable the joint venture, Daimler Trucks is bringing together all group-wide fuel cell activities in a new Daimler Truck fuel cell unit. Part of this bundling of activities is the allocation of the operations of “Mercedes-Benz Fuel Cell GmbH,” which has longstanding experience in the development of fuel cell and hydrogen storage systems for various vehicle applications, to Daimler Truck AG.

The joint venture will include the operations in Nabern/Germany (currently headquarters of the Mercedes-Benz Fuel Cell GmbH) with production facilities in Germany and Canada.

A final agreement is expected by Q3 and closing before year-end 2020. All potential transactions are subject to examination and approval by the responsible competition authorities.

“… Using hydrogen as a carrier of green electricity to power electric trucks in long-haul operations is one important part of the puzzle, and a complement to battery electric vehicles and renewable fuels. Combining the Volvo Group and Daimler’s experience in this area to accelerate the rate of development is good both for our customers and for society as a whole. By forming this joint venture, we are clearly showing that we believe in hydrogen fuel cells for commercial vehicles. But for this vision to become reality, other companies and institutions also need to support and contribute to this development, not least in order to establish the fuel infrastructure needed,” says Martin Lundstedt, Volvo Group president and CEO.

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