Hydrogen-powered Commercial Vehicles – Demand Overview & Outlook

How has fuel cell technology been used historically, and why is there so much buzz around it at this point, particularly in heavy-duty vehicles?

My understanding is that while BEV [battery electric vehicle] technology is very attractive for smaller vehicles, it just doesn’t make sense from a weight and battery capacity standpoint for implementing into heavy-duty vehicles at this time. Is this basically in line with your assessment? If so, is there a chance that battery technology could evolve to the point where it could be more attractive in heavier vehicles?

Where could we see BEVs take hold in the commercial space vs fuel cells? Is there a particular weight of vehicle where there’s a breaking point and it starts to make more sense to go with the fuel cell, whether that’s Class 5, Class 6, Class 7 or Class 8 vehicles?

How do fuel cell-powered heavy-duty vehicles stack up relative to ICE [internal combustion engine] equivalents today? Taking a step back from the idea that there would need to be substantially more infrastructure for hydrogen to be viable, how do they compare on general capabilities, distance travelled and refuelling times?

My understanding is that there’s been some historical use of natural gas to power fuel cells. Are companies focusing on hydrogen fuel cells simply because of the focus on zero emissions, or will there be a place for natural gas fuel cells in the space as well?

How should we think about the TAM for fuel cell technology? As we said, the future looks like it will be split between BEV and fuel cell technology, and we’re not exactly sure where fuel cell technology begins to make more sense in terms of size of vehicle. What does that market share trajectory look like for fuel cell vehicles? As of now, I believe it’s basically zero.

Is there anything we can take away from more progressive markets, particularly Europe, in terms of how fuel cell market penetration will take hold and spread from there? Is there a significant difference at this point in the market share of fuel cell technology in Europe vs the US, or are we still talking about low single-digit percent market share in both geographies?

One core limiting factor of market share growth is a lack of production and infrastructure. Historically, who has produced fuel cells? Will the fuel cell production market look very similar to that for heavy-duty ICEs today, where there are a few select players that sell to everyone else? Will most major OEMs [original equipment manufacturers] likely have proprietary fuel cells? How do you see production shaking out?

Are there challenges to manufacturing fuel cells? Does this involve building a new supply chain from scratch? Are different materials needed? Will there be some inherent bottlenecks when ramping up the production of fuel cells?

Could refuelling infrastructure be the biggest challenge of all? What does the ramp-up in hydrogen production and infrastructure look like? Are there any markets we can begin to look at to see how this will play out?

We’ve discussed incumbents in the heavy-duty truck space, but there’s been a lot of interest in some of the smaller players and their evolution. I’d say Nikola has gotten the majority of press when it comes to hydrogen fuel cell heavy-duty trucks. What should we look for from a Nikola to gauge whether such a player has the legs to be a major in this space, or whether it’s just press?

As you mentioned, Nikola’s in an interesting position, in that perhaps it can be seen as an early mover, but unlike incumbent OEMs such as Cummins or Volvo, it doesn’t have the luxury of the supplier relationships. It doesn’t have the size and leverage to negotiate and put itself at the front of the line in terms of supply. It’s partnered with Iveco for vehicle production, but do you see Nikola struggling or being boxed out in any way as production begins to ramp and more players get into this space?

We’ve covered the addressable market, supply chain, fuel cell production and individual players. What else should we talk about? What have we left out at this point? Is anything else key to assessing the space?

What key metrics should we use to grade fuel cell companies and determine winners and losers? My mind always goes to production, but it seems a bit early to gauge players on production numbers and so on.