Three pivotal factors driving fuel cell electric vehicle (FCEV) market expansion through 2027

Author: Global Market Insights - March 23, 2022

In June 2021, British automobile manufacturer Jaguar Land Rover made it to the headlines for a critical advancement in the fuel cell electric vehicle (FCEV) market. The company carried the story for the development of a prototype hydrogen FCEV based on the new Land Rover Defender.

The concept formed part of the automaker’s aim to realize net zero carbon emissions across its operations, products, and supply chain until 2039 and zero tailpipe emissions by the year 2036. While FCEVs are complimentary to BEVs (battery electric vehicles) on the journey to net zero vehicle emissions, the technology is particularly sought for its extensive range of benefits comprising rapid refueling, high energy density, and the minimal loss of range in low temperatures.

Similar advancements are touted to augment fuel cell electric vehicle market size, which is projected to exceed USD 15 billion by 2027, as per Global Market Insights Inc. Here’s a brief account of some of the prominent factors that are expected to influence the global business scenario over the ensuing years:

1# Growing formation of alliances in North America

Several companies and regulatory bodies in North America are forging collaborations for gaining a deeper understanding of the major trends driving the regional landscape. For instance, according to a report published by the California Fuel Cell Partnership, hydrogen fuel cell powered car sales in California hit a mark of 400 in the month of April 2021.

The alliance is centered on providing the latest FCEV statistics including the number of operational fuel cell buses and the number of hydrogen stations in the state. Such insights are expected to help regional players in the formulation of strategic initiatives over the forecast period.

2# Increasing FCEV studies in the Asia Pacific

In 2021, the Singaporean government commissioned a study for assessing the feasibility of importing hydrogen for deployment in downstream applications. The research unveiled hydrogen as a cost-effective alternative for cars in the country, underscoring potential scope for use in buses, taxis, and heavy goods vehicles.

This is because the BEV versions of buses and taxis require long charging time and large batteries, which is not feasible as they are meant for covering long distances. Furthermore, the study also highlights that, in case of private cars, hydrogen FCEVs hold no clear advantage over BEVs given the low mileage chalk up in the country.

3# Rising adoption of collaborative agreements by leading industry players

Prominent participants in the FCEV market comprise Hyundai Motor Group, SAIC Motor Corporation, Audi AG, Volkswagen, Honda Motor Co., Ltd., Toyota Motor Corporation, and others. A number of these companies are depicting a keen interest in the implementation of capacity expansion initiatives comprising mergers, acquisitions, partnerships, and others for the consolidation of their position in the industry.

Quoting an instance, in December 2021, Edison Motors inked a partnership agreement with Power Plug for the development of a hydrogen fuel cell-powered electricity bus, tentatively called the SMART 110F. The deal gave Edison Motors access to Plug Power’s 125kW ProGen fuel cell system, facilitating the rollout of the advanced vehicle in the initially targeted market of South Korea.