Last week we said that electric cars are the future, it’s our opinion that at some point, not too far away, new car buyers will be purchasing mostly electric or hybrid-electric vehicles. The electric vehicles we were talking about are battery powered electric cars.
There is another alternative, fuel cell electric vehicles powered by hydrogen.
Both Toyota and Hyundai are producing hydrogen vehicles though they aren’t selling any in New Zealand as yet.
In terms of volume, the production numbers are still tiny. To give you some idea of the scale, Toyota, the car giant that makes 10 million cars annually, currently produce around 3,000 of its hydrogen fuel-celled electric Mirai vehicle. Even though they plan to increase production to 30,000 in 2020, the volume will still be a tiny proportion of Toyota’s total production. Toyota is probably the most advanced hydrogen fuel-cell electric vehicle manufacturer.
Still, Toyota and other vehicle manufacturers are investing billions of dollars in these types of vehicles and they don’t do that for no purpose.
There are at least three key technical challenges that need to be solved before we see the widespread introduction of hydrogen fuel-cell powered electric vehicles. Here’s the three we can see.
· Investment in a hydrogen infrastructure. To be able to roll out large scale production of hydrogen powered electric vehicles there needs to be a significant invest in a brand-new hydrogen production and vehicle fueling infrastructure. This will be time consuming and expensive, but not impossible, though it will require a strong political will. Japan threw the heft of the world’s third largest economy behind fuel cells and announced plan to turn the island nation into a " hydrogen society" anywhere between 2030 and 2050. Japan’s politician’s wants hydrogen in a greater hurry, and aims to realize the hydrogen society by 2020, when the Olympics are held there. Germany and China too have announced large scale investment in hydrogen infrastructure.
· The investment required by car companies to produce hydrogen powered fuel-cell electric vehicles. Car companies are already having to invest billions of dollars in developing multiple engine technologies: pure battery electric, fossil fuel/electric hybrids and diesel and petrol, the costs are staggering. Only the largest car companies will be able to make this investment – and because they need to invest in multiple future engine powered options, this slows down the implementation of hydrogen powered vehicles.
· Scale up fuel cell production to get economies of scale to bring down the price. This is really an extension of technical challenge above. Currently hydrogen fuel-cell battery powered vehicles are very expensive. Manufacturers will probably be losing money on them too because of the massive development costs. For manufacturers though its part of the development and proof of concept process. As production expands, costs will reduce and conceptually hydrogen fuel-cell electric vehicles could be cheaper or at least as cheap to produce as current internal combustion engine cars. That’s when there is significant production scale.
So, to answer the initial question, hydrogen vehicles in New Zealand: will they become a mainstream option for new car buyers? Unless there is strong political leadership, we will follow the rest of the world – though some years behind – so no - not anytime soon.
The Car Brokers can help you determine the best vehicle for your specific needs and then find and negotiate the best deal for it. Email us at thecarbrokers.co.nz - we’ll do the hard work and save you money.