Two heavyweights in the trucking world, Daimler Truck and the Volvo Group, have signed a preliminary nonbinding agreement to establish a new joint venture (JV) to develop, produce and commercialise fuel-cell systems for heavy-duty vehicle applications and other uses. 

German truck maker Daimler will consolidate all its current fuel-cell activities in the JV. 

Sweden’s Volvo Group will acquire 50% in the JV for the sum of about E600-million on a cash and debt free basis. 

“Transport and logistics keep the world moving, and the need for transport will continue to grow,” says Daimler Truck chairperson Martin Daum.

“Truly carbon dioxide-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,” explains Daum. 

“This joint initiative with the Volvo Group is a milestone in bringing fuel-cell-powered trucks and buses onto our roads.”

The 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, adds Volvo Group president and CEO Martin Lundstedt.

“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.”

STRUCTURE OF THE JV
The Volvo Group and Daimler Truck will be 50:50 partners in the JV, which will operate as an independent and autonomous entity, with Daimler Truck and the Volvo Group continuing to be competitors in all other areas of business. 

Joining forces should 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. 

In the context of the current economic downturn, cooperation has become even more necessary in order to meet the Green Deal objectives within a feasible timeframe, note the companies.

The common goal is for both companies to offer heavy-duty vehicles with fuel cells for 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 group-wide fuel-cell activities in a new Daimler Truck fuel-cell unit.

Part of this bundling of activities is allocating the operations of Mercedes-Benz Fuel-Cell, which has long-standing 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 (the current headquarters of 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 and the closing of the deal before year-end. 

All potential transactions are subject to examination and approval by the responsible competition authorities.

HOW IT WORKS
A hydrogen fuel-cell converts the chemical energy of the fuel, in this case hydrogen, and oxygen (in the air) into electricity. The electricity powers the electrical motors that propel an electrical vehicle. 

There are two main ways to produce the hydrogen needed. 

So-called green hydrogen can be produced locally at gas stations, using electricity to convert water into hydrogen. 

Blue hydrogen is expected to be produced from natural gas, using carbon capture technology to create a carbon-neutral fuel.