Volkswagen AG bought fuel-cell technology from Ballard Power Systems Inc. in a deal worth as much as $112 million to advance the German automaker’s development of clean-running vehicles.
Ballard will transfer automotive-related patents to VW for $50 million and will provide engineering services through March 2019, the Canadian technology company said Wednesday in a statement. Ballard shares surged the most in almost two years.
“We are securing crucial expertise that will provide new impetus for the further development of this technology,” Ulrich Hackenberg, the development chief of Volkswagen’s Audi unit, said in a statement. Audi plans to make the technology available to other Volkswagen brands, which include Porsche, Bentley and Lamborghini.
Ballard stock rose as much as 59 percent to $2.68, the biggest gain since March 2013.
Fuel cells create electricity in the chemical reaction that creates water from the combination of hydrogen and oxygen. The technology offers prospects for zero-emission vehicles with longer ranges than current electric cars. Still, executives including Nissan Motor Co. Chief Executive Officer Carlos Ghosn and Tesla Motors Inc.’s Elon Musk have questioned the economic viability of the technology. The vehicles also require investment in hydrogen fueling stations.
Toyota Motor Corp., the world’s largest automaker, started selling the $62,000 fuel cell-powered Mirai sedan in Japan in December. It will be available in the U.S. and Europe later this year and has a driving range of 300 miles, more than most plug-in electric cars. It emits only heat and water.
While VW has been cautious about the large-scale rollout of the technology in the near term, the Wolfsburg-based company has intensified development efforts. In recent months, the automaker has presented fuel cell-powered concept cars based on the VW Golf hatchback and Passat sedan as well as the Audi A7 luxury coupe.