Automotive manufacturers Volvo Group and Daimler Truck have signed a preliminary non-binding agreement to establish a new joint venture (JV) to develop, produce and commercialise fuel cell systems for heavy-duty vehicle applications and other use cases.
Both companies share the Green Deal vision of sustainable transport and a carbon neutral Europe by 2050.
Daimler will consolidate all its current fuel cell activities in the JV, as the Volvo Group will acquire 50% in the JV for a total of about €600-million on a cash- and debt-free basis.
“Transport and logistics keep the world moving, and the need for transport will continue to grow. Truly carbon-neutral transport can be accomplished through electric drive trains with energy coming either from batteries or by converting hydrogen on board into electricity,” says Daimler Truck AG board of management chairperson Martin Daum.
He mentions that 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 JV is a milestone in bringing fuel cell-powered trucks and buses onto our roads.”
Daum adds that electrification of road transport is a key element in delivering the so called Green Deal, a carbon neutral Europe and ultimately, a carbon neutral world.
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 both company’s experience in this area to accelerate the rate of development is good both for our customers and for society as a whole,” states Volvo Group president and CEO Martin Lundstedt.
Lundstedt adds that the formation of the JV shows both companies’ belief in hydrogen fuel cells for commercial vehicles. For this to happen, however, he points out that other companies and institutions also need to support and contribute to this development, not least in order to establish the fuel infrastructure needed.
The Volvo Group and Daimler Truck will be 50:50 partners in the JV, which will operate as an independent and autonomous entity, with both companies 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, says Lundstedt.
He points out that in the context of the current economic downturn, cooperation has become even more important in order to meet the Green Deal objectives within a feasible timeframe.
The common goal for both companies is to offer heavy-duty vehicles with fuel cells for demanding long-haul applications in series production in the second half of the decade. In addition, other automotive and non-automotive use cases are also part of the new JV’s scope.
To enable the JV, Daimler Trucks is bringing together all the group’s 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 in Germany, which has longstanding experience in the development of fuel cell and hydrogen storage systems for various vehicle applications, to Daimler Truck.
The JV will include the operations in Nabern, Germany – currently headquarters of the Mercedes-Benz Fuel Cell – with production facilities in Germany and Canada.
The signed preliminary agreement is non-binding. A final agreement is expected by the third quarter of this year, and closing before year-end. All potential transactions are subject to examination and approval by the responsible competition authorities.