Volvo, the Swedish truck manufacturer and its German rival Daimler recently announced plans to partner on development and sales of fuel cells for powering heavy-duty trucks, as the uncertainty related to the COVID-19 pandemic and costs of new technology are coercing large auto manufacturers to combine their global resources.
Reportedly, Daimler will consolidate all its fuel cell activities in the JV and the Volvo Group will acquire 50% of the JV for approximately USD 650 million. However, the joint venture would remain open to including other companies as well.
Martin Daum, Chairman at Daimler Truck BoM, said in a statement that fully carbon dioxide-neutral transport can be attained only through electric drive trains with energy coming either by converting hydrogen on board into electricity or directly from batteries. Daum added that the partnership with Volvo Group is a milestone in taking fuel cell powered buses and trucks onto roads.
Martin Lundstedt, Chief Executive Officer of Volvo Trucks reportedly said that the COVID-19 pandemic has convinced them even more that this field still needs continued focus.
Other automotive giants have also been pursuing fuel cells for use in their large commercial trucks. Earlier this year, Hino, the truck manufacturing subsidiary of Toyota announced plans to develop a heavy-duty fuel cell truck. The fuel cell technology combines oxygen and hydrogen inside a fuel cell stack in order to produce electricity.
Daimler will consolidate its fuel cell activities in a new fuel cell unit, along with those of Mercedes-Benz Fuel Cell GmbH. In addition, the JV will also look at automotive as well as non-automotive utilization of the technology. The collaboration will also include Daimler operations in Nabern, Germany, and other plants in Canada and Germany.
While the agreement that has been recently announced is preliminary and non-binding, both firms are expecting to reach a final agreement before September end and close the transaction before 2020 end.