GA Trade Sep-Oct Interactive - page 24

Technology Benefits from
Regulations in California
In order to complywith the CARB
regulations, car manufacturers focus
primarily on electric vehicles.
However, according to sector experts,
reaching the target by focusing on
this technology alone is close to
impossible. Themarket development
in this sector remains uncertain, not
least due to the insufficient range of
these cars.
Thus, manymanufacturers aim to
diversify their portfolio of ZEVs.
Hydrogen cars are increasingly the
focus of attention. In addition,
customers in the state’s metropolitan
areas are open-minded towards new
technologies on an above-average
level. Amongst other things, Califor-
nia has already proven itself as
testing ground for new drive
technologies for hybrid and electric
vehicles.
Mainly in the south of the state, the
obstacle of not having a sufficient
network of filling stations is not as
severe as in the nation’s other
regions. According to the U.S.
Department of Energy eight of ten
public hydrogen filling stations
available in the U.S. can be found
here. Mostly due to the existing
rudimentary infrastructure, test
vehicles equippedwith this type of
drive technology are only offered in
this part of the country. So far,
Honda’s “FCX Clarity" as well as the
"F-Zell" byMercedes have only been
leased by customers in Southern
California.
19 additional filling stations are
either in the construction or in the
planning phase in the state. Accord-
ing to calculations by Toyota, for
San Francisco, the SiliconValley as
well as for California’s south 68 new
filling stations would be required to
achieve amoderatemarket break-
through in the state. This would
satisfy the demand of some 10,000
fuel cell vehicles.
The state’s government is making
great efforts to expand the network
accordingly. In September 2013, a
bill important for the development of
the technologywas passed (Assembly
Bill 8). Until the beginning of 2024,
the state will provide some $20
million annually for the installation
of 100 additional public filling
stations in total.
High Production Costs
Thwart Market Development
Even if the first hydrogen cars ready
for serial productionwill soon roll
onto themarket, the technologywill
likely remain a niche technology for
now, even in California. The Asian
manufacturers have all stated
without exception that theywill offer
the vehicles for sale or leasing only
in small quantities at first. This is not
only a result of the insufficient
network of filling stations. OEMs are
still incurring losses when it comes
to selling hydrogen vehicles.
According to Toyota’s expectations,
the companywill make a profit
selling such vehicles in 2020. Honda
expects to reach the profit zone five
years after that. The latter calculates
production costs of some $50,000
per car. Until 2020, these are
expected to be cut in half thanks to
technological progress and econo-
mies of scale.
Numerous strategic partnerships have
been formed during the last couple
of years. Bymeans of research and
development costs are to be reduced
and the technological breakthrough
is to be pushed. General Motors
collaborates withHonda. Toyota and
BMW have also agreed on a strategic
collaboration. In addition, Nissan,
Daimler and Ford have joined forces.
These alliances aim at amarket
launch between 2015 and 2020.
n
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GTAI
INDUSTRY TALK
Detailed industry reports, written by the U.S.
correspondents of German Trade and Invest
(GTAI), the official German foreign trade and
inward investment agency.
About theAuthor
Christian Janetzke
Director, Germany Trade and Invest
75Broad Street, 21st Floor
New York, NY 10004
T 212-584-9717
G T A I I N D U S T R Y T A L K
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