## Ballard signs long-term fuel cell engineering services contract with Volkswagen AG; expected value of C$60-100 million ##### 07 March 2013 Ballard Power Systems has signed an agreement with Volkswagen Group for a major Engineering Services contract to advance development of fuel cells for use in powering demonstration cars in Volkswagen’s fuel cell automotive research program. The contract term is for 4-years, with an option for a 2-year extension. The expected contract value is in the range of C$60-100 million.

Work will involve the design and manufacture of a next-generation fuel cell for use in Volkswagen HyMotion demonstration cars. Ballard engineers will lead critical areas of fuel cell product design—including the membrane electrode assembly (MEA), plate and stack components—along with testing and integration work.

This research agreement with Ballard demonstrates our commitment to the development of clean energy fuel cell transportation alternatives. I anticipate accelerating our automotive fuel cell program as a result of this collaborative effort, which will bring together additional fuel cell skills and expertise in both organizations.

—Dr. Juergen Leohold, Head of Group Research at Volkswagen AG

Over the past several years, Ballard has made significant advances in its commercial fuel cell products, with average product cost reductions of 60% and increases in product durability. Sales of Ballard’s clean energy fuel cell products have also been accelerating, with a 30% cumulative annual growth rate (CAGR) in revenue since 2010.

The announcement of this research agreement with Volkswagen Group, a recognized global leader, is a major step for Ballard both strategically and financially. It represents a tremendous ramp-up in our Engineering Services business following the recent expiration of the five year automotive non-compete agreement.

Ballard’s focus with Volkswagen in this new automotive fuel cell research program will parallel our continuing work in commercial fuel cell markets for backup power and material handling—enhancing product durability and performance while radically reducing product costs.

—John Sheridan, Ballard President and CEO

Additional details regarding the agreement between Ballard and Volkswagen will be filed by Ballard in a Material Change Report which will be available on SEDAR.

Ballard was founded in 1979 to conduct research and development on high-energy lithium batteries. In the course of investigating environmentally clean energy systems with commercial potential, it began developing fuel cells in 1983. Over time, Ballard entered into a number of strategic alliances related to fuel cell R&D, including an alliance with Daimler AG and Ford Motor Company.

In 2007, Ballard sold the company’s automotive fuel cell assets to Daimler and Ford as part of a major corporate transformation from 2007 to 2009. (Earlier post.) The company shifted its strategic focus from long-term, high cost automotive fuel cell R&D technology development to fuel cell products for near-term commercial markets: backup power, distributed generation, material handling and bus applications.

I can't think of a major car company that is not pursuing fuel cells, in spite of the wisdom of various blokes on a blog, who have conclusively proved on the back of an envelope that it is a very silly idea.
Perhaps it is possible that the car companies know something?
At any rate, they are putting their money where their mouths are.

It's the range of EVs and other constraints battery powered cars force the customer to accept which car manufacturers want to solve. Ultimately the manufacturers want to sell cars which appeal to the average buyer.

Another in fifty years of fuel cell articles that dare not mention the MSRP.

According to opponents, fuel cell vehicles were never going to drop below perhaps $300,000 per vehicle. Their cost forecasts were about as accurate as their appreciation of how technology works. @Dm, so$90,000 to $290,000 and no FC H2 fuel or infrastructure is sitting in your driveway? @Kelly: Presumably you argued the same thing against battery cars a few years ago. Because if not you simply do not understand what constitutes an even-handed critique and what is polemic in support of a hobby horse. We are in our 11th year of "the Hydrogen (fuel cell vehicle) Initiative" - so where are the 'forecast' thousands/millions of FCVs sold? Didn't the 1970s forecast most cars to be fuel cell powered by 2012? Nice that automakers MIGHT build one FVC per day for fleet lease in 2013, maybe with their own funds. Track record fact: Auto makers have sucked$billions of public funds for fuel cell vehicles for decades.

With suckers to believe them, why stop?

I have no idea what forecasts were in the 1970's
I should imagine that sufficient ill-will would turn up inaccurate forecasts for battery cars too, and in fact one could probably do that for around 1900.

That would remain as irrelevant as your 'argument'.
Why don't you apply the same distorting lens to battery cars?
Clearly only comparatively trivial numbers are being produced at a cost of billions in investment.

You sound like Fox News on the Volt or Leaf.

@Dm, "Presumably you argued the same thing against battery cars a few years ago."

WRONG, I've thought battery cars economically viable for many years.

Ex: http://www.greencarcongress.com/2009/11/nissan-nmc-20091129.html
"..Why is the one commercially proven EV battery patent/chemistry bounced about - inventor, GM, Chevron, Sanyo, ..?

Posted by: kelly | November 29, 2009 at 09:01 AM"

@Dm, "Why don't you apply the same distorting lens to battery cars?"

Because GM knew battery EVs were efficient and would hurt their ICE sales - so GM crushed EVs("Who Killed..E Car") and promo'ed fuel cells as grant fraud and a red herring.

Because I've seen 199X RAV4 EV's on the road, besides thousands of newer Prii and Leafs.

Because I'm an electrical engineer who understands electric flexibility, near commercialized battery improvements, and that fewer moving parts are less expensive manufacture and maintenance.

And finally, IF fuel cells even become cheap and reliable - there still won't be a economic H2 infrastructure in my lifetime.

Depending on your age, there probably wont be infrastructure to have BEVs in every household either(grid-wise/ reserve power capacity(it takes almost a decade to online a power station)). That's not even to say making it practical, like high rated charges running three-phase at an ungodly amperage so it doesn't take 2-8hours a charge to 80%

The only BEV at the moment that I could see using in my daily meanderings is the Tesla, but it still doesn't do enough for me to consider it a viable option, even if it were priced the same as I car that I'd shop for, I'd still have to think about it for a long while, basically plan my life around the car if I chose to go with it, where a gaser would allow me to have freedom much farther and faster than an outlet.

I think that FCs take all the good things about electric cars and make them practical, and livable for most Americans. Range/Charge/Pumping times become a non issue, 7-10 mins and its smooth sailing for another usable 280+miles or so.

I think if you say 600K for a car, you are neglecting that prototypes are a not cheap, and if you would add the cost in development to the sticker of limited run cars to the MSRPs you'd end up like most and Lambo and Ferarri prices which are the numbers you are pulling from. Where in reality, the actual cost to implement are much lower than a "sticker" on a test mule.

Car manufactures are actively moving forward with the idea, this isn't some flying car fantasy, they are investing tons and plan to go to market in the 2017 model year. This is 2013 so they see this as a very near term solution to Gasoline. Remember they only want to make things that they can sell, not because they have to.(yes its a limited run, but they are moving far faster than most were hoping batteries would, and this shows optimism...)

Ford and several others made a BEV car that wasn't suitable for most the population and the numbers show, How many millions did it cost to engineer, design, and produce that half baked focus? Answer: Plenty! I'm sure if you divided Ford's initial investment on how many they sold so far you'd end up at those six digit numbers too.(and they did it as cheaply as possible)

And another note, fuel cells are used in industry, military, emergency and telecommunication situations... that is as in its ongoing, private sector, and now, its a little bit less of an "If" but more of a "when"... This is not some daydream, it offers a practical solution to the need for cheap, domestic energy.

BEVs I believe are going to be limited to city cars, and expensive sports sedans, but wont offer any practical solutions to freight or even many other forms of light duty applications. (PHEV, ICEs and probably FCs will take the rest of the market handedly)

I think the cost estimate is sub-\$40 per Kw in 2017 at 500K units of production, which in reality would really put a hamper on BEVs going forward.

If it is a viable alternative to /better than gasoline, you better bet the infrastructure will hasten itself into existence. There has been even talks of home production of H2...not going to happen, but it could be made on site... unlike gasoline which has to be shipped several hundred miles.

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