General Motors Co. and Honda Motor Co. Ltd. equally split $85 million in investment to expand their fuel-cell partnership into a new manufacturing venture in southeast Michigan, the companies announced Monday.
Fuel Cell System Manufacturing LLC — the auto industry’s first joint venture for fuel-cell manufacturing — will operate inside GM’s battery pack assembly plant in Brownstown Township. The companies plan to mass-produce a hydrogen fuel-cell system to be used in vehicles starting around 2020. The work is expected to create nearly 100 jobs, the companies said.
The Michigan Strategic Fund Board on Monday voted to approve a $2 million performance-based grant to back the venture. The Michigan Economic Development Corp. said the move is expected to create up to 70 jobs in Brownstown and spur $48.9 million of capital investment there.
The higher jobs figure also will include engineering and other positions, a GM spokesman said.
The automakers held a news conference Monday in Detroit, which included Michigan Lt. Gov. Brian Calley, and where the companies showed a newly developed fuel-cell stack, which was about the size of a laptop. Fuel cell systems in a first-generation GM van took up the entire floor space.
The carmakers have worked together on fuel-cell development through a partnership that was announced in 2013. The car companies then said they had signed a long-term agreement to co-develop a next-generation fuel cell system and hydrogen storage technologies. The companies integrated development teams and shared intellectual property on hydrogen fuel cells “to create a more affordable commercial solution for fuel cell and hydrogen storage systems.”
GM and Honda signed a collaboration agreement for fuel cell manufacturing and in late December approved the joint venture.
The companies said they will work together to cut costs to develop and manufacture the cells through scale and common sourcing. .
“GM and Honda will continue to work together to further enhance refueling infrastructure. This remains a critical step in the long-term viability and consumer acceptance of hydrogen fuel cell vehicles, said Toshiaki Mikoshiba, chief operating officer of the North American Region for Honda Motor Co. Ltd. and president of Honda North America Inc. “Honda believes that hydrogen fuel cell vehicles can act as a core energy system to support a sustainable society and meet the needs of our customers.”
Hydrogen refueling stations are sparse and now mainly in California.
GM and Honda say the joint company will have a board of directors, including three executives from each company with a rotating chairperson. A president and executive vice president also will be appointed to rotate between the companies, they said.
Mark Reuss, GM’s head of global product development, purchasing and supply chain, told reporters Monday that GM has not committed to using fuel cells in a vehicle for retail customers, but said the company could have other uses for them and could sell them to the aerospace and military industries. Honda plans to use the fuel cell systems in its next-generation fuel cell vehicle.
“While there will continue to be skeptics, I think we can safely say that today’s announcement officially marks the arrival of fuel cells,” said Dan Nicholson, GM’s vice president of global propulsion systems. “They’re not a science project anymore; they’re a mainstream alternative energy choice.”
GM has trademarked and established the Hydrotec brand name for its fuel cell systems. The company has about 200 employees working on fuel cells and work is based from its Global Propulsion Systems headquarters in Pontiac. Some work also takes place in Japan.
Fuel cell vehicles can run on renewable hydrogen from wind and biomass, with water vapor as the only emission. While carmakers see promise in the technology for its environmental benefits, hydrogen refueling stations are very sparse, a huge hurdle to mass deployment.
GM has worked for decades on the technology and since the late 1990s has invested nearly $3 billion into fuel-cell technology. In 2007, it launched a fleet of 119 hydrogen fuel-cell Chevrolet Equinox vehicles that were driven daily and tallied more than 3 million miles. And more recently, GM has been working with the military to show capabilities of fuel cells in other environments.
In December, Honda began selling its new Clarity Fuel Cell vehicle only in California in the U.S., logging eight sales last month. It also began selling the Clarity in spring 2016 in Japan. The Clarity offers a driving range of 366 miles.
The companies have worked together in the past, collaborating in a powertrain partnership in 1999, that included Honda building 50,000 V-6 engines for the Saturn Vue and Honda receiving diesel engines from GM Isuzu for use in Europe.