Analysis of Hydrogen Vehicles for the Automotive Industry

Lions Financial focuses on helping companies in the automotive and trucking industry through capital markets financing and business consulting engagements. We have put together an overview of the utilization of hydrogen fuel for motive power in vehicles. We evaluate the significant investment in research and development for the application of hydrogen for the mobility and transportation industry including automobiles, trucks, and utility vehicles.

Hydrogen Technology That is used for fuel cell electric vehicles
Hydrogen Technology That is used for fuel cell electric vehicles

Hydrogen vehicles use fuel cell electricity using a fuel cell powered by hydrogen, rather than drawing electricity from the battery. The vehicle design process by manufacturers defines the power of the vehicle by the size of the electric motors that receive electric power from the appropriately sized fuel cell and battery combination. Automakers design the battery for recapturing braking energy, providing extra power during short acceleration events, and to smooth out the power delivered from the fuel cell with the option to idle or turn off the fuel cell during low power needs. During the reaction, hydrogen and oxygen combine to produce electrical energy and harmless water vapor as a byproduct. If that initial chemical reaction is large enough, it can move an entire vehicle. The amount of energy stored onboard is determined by the size of the hydrogen fuel tank, Hydrogen tanks can be refuelled in a process that’s pretty much the same as with a petrol or diesel car. This is different from an all-electric vehicle, where the amount of power and energy available are both closely related to the battery’s size.

Effectiveness Of Hydrogen Energy
Effectiveness Of Hydrogen Energy

The energy produced by the hydrogen-oxygen reaction is run through a fuel cell and produces electricity instead of an explosion. An extreme amount of energy is released with no toxic byproducts, which is what makes hydrogen fuel cells such a great power source for electric vehicles. The hydrogen itself can be produced by running this process in reverse, which is called electrolysis. Running an electrical current through water separates the H2O into hydrogen and oxygen. Hydrogen is produced at scale from natural gas in a process called steam-methane reforming, in which high-temperature and high-pressure steam is combined with natural gas to create hydrogen. This process does produce some carbon dioxide, so the hydrogen fuel itself isn’t 100 percent clean.

As battery electric cars come to the fore, the automotive industry is grappling with their two major downsides for drivers. First, it can take hours to fully charge a battery vehicle if you don’t have access to a fast charger, and second, even with a full battery, most electric cars struggle to travel half the distance of a conventional car on a full tank of gas. Fuel-cell hydrogen vehicles don’t have those problems. Hydrogen can be pumped into a vehicle’s fuel tank just like gas. You can fill up quickly, the same way you would with gas or diesel. And once it has a full tank, a fuel-cell vehicle can travel just as far as a gas vehicle.

Source From:  Popular Mechanics

Hydrogen Fuel Cell Vehicle
Hydrogen Fuel Cell Vehicle

Source From: Energy Efficiency & Renewable Energy

The key component of hydrogen fuel cell electric car
The key component of hydrogen fuel cell electric car

Battery (auxiliary): In an electric drive vehicle, the auxiliary battery provides electricity to start the car before the traction battery is engaged and also powers vehicle accessories.

Battery pack: This battery stores energy generated from regenerative braking and provides supplemental power to the electric traction motor.

DC/DC converter: This device converts higher-voltage DC power from the traction battery pack to the lower-voltage DC power needed to run vehicle accessories and recharge the auxiliary battery.

Electric traction motor (FCEV): Using power from the fuel cell and the traction battery pack, this motor drives the vehicle’s wheels. Some vehicles use motor generators that perform both the drive and regeneration functions.

Fuel cell stack: An assembly of individual membrane electrodes that use hydrogen and oxygen to produce electricity.

Fuel tank (hydrogen): Stores hydrogen gas onboard the vehicle until it’s needed by the fuel cell.

Power electronics controller (FCEV): This unit manages the flow of electrical energy delivered by the fuel cell and the traction battery, controlling the speed of the electric traction motor and the torque it produces.

Fuel filler: A nozzle from a fuel dispenser attaches to the receptacle on the vehicle to fill the tank.

Thermal system (cooling) – (FCEV): This system maintains a proper operating temperature range of the fuel cell, electric motor, power electronics, and other components.

Transmission (electric): The transmission transfers mechanical power from the electric traction motor to drive the wheels.

Emissions Evaluation


Petrol or Diesel vehicle

Gasoline is a toxic and highly flammable liquid. The vapors are given off when gasoline evaporates, and the substances produced when gasoline is burned (carbon monoxide, nitrogen oxides, particulate matter, and unburned hydrocarbons) contribute to air pollution. Burning gasoline also produces carbon dioxide, a greenhouse gas. (Gasoline and the environment, 2020)


Electric vehicle

Hybrid and plug-in electric vehicles can have significant emissions benefits over conventional vehicles. Once they are moving, there’s no chemical reaction happening either, only an electric one thanks to the power batteries were previously charged with. HEV emissions benefits vary by vehicle model and type of hybrid power system. EVs produce zero tailpipe emissions, and PHEVs produce no tailpipe emissions when in all-electric mode. (Electric Vehicle Benefits and Considerations, 2020)


Hydrogen fuel cell vehicle

Hydrogen can be produced from diverse domestic resources with the potential for near-zero greenhouse gas emissions. Once created, hydrogen generates electrical power in a fuel cell, emitting only water vapor and warm air. It holds promise for growth in both the stationary and transportation energy sectors.

The environmental and health benefits are also seen at the source of hydrogen production if derived from low- or zero-emission sources, such as solar, wind, and nuclear energy, and fossil fuels with advanced emission controls and carbon sequestration. Because the transportation sector accounts for about one-third of U.S. carbon dioxide emissions, using these sources to produce hydrogen for transportation can cut greenhouse gas emissions. (Hydrogen Benefits and Considerations, 2020)

Cost Evaluation


Petrol or Diesel vehicle

Gasoline powered automobiles take advantage of a modern infrastructure built for their presence. With gas stations and auto repair shops around every corner, owning a gas car is both convenient and easy. Gasoline cars are great for saving money on the upfront cost of purchasing a vehicle. (The Benefits of Gas vs. Electric Cars, 2012)


Electric vehicle

Although energy costs for hybrid and plug-in electric vehicles are generally lower than for similar conventional vehicles, purchase prices can be significantly higher. Prices are likely to equalize with conventional vehicles as production volumes increase, and battery technologies continue to mature. (Electric Vehicle Benefits and Considerations, 2020)


Hydrogen fuel cell vehicle

To be competitive in the marketplace, fuel cells’ costs will have to decrease substantially without compromising performance. From at least one original equipment manufacturer, the predicted cost of mass-produced fuel cell electric vehicles could be similar to their hybrid counterparts’ cost by 2025. Unlike a battery, where most of the cost comes from the raw materials used to make it, the most expensive part of a fuel cell is in manufacturing the fuel cell stack itself—not the materials to produce it. The cost to build and maintain hydrogen fueling stations also needs to decrease for the market to support a hydrogen economy. (Hydrogen Benefits and Considerations, 2020)

Recharging/Refueling Evaluation


Petrol or Diesel vehicle

Gasoline filling stations can be seen everywhere globally, and it only takes 2 to 3 minutes to fill up. The car can run 480-640km (300-400 miles) with one filling. Convenient refueling is the most significant advantage of gasoline vehicles, and it is also the reason why many people choose gasoline vehicles. (source: Hydrogen fuel cell us electric cars: what you need to know but couldn’t ask)


Electric vehicle

The main problem for electric vehicles is that charging is prolonged. The charging time is between 30 minutes and 12 hours. Tesla’s fast chargers (with 120 kW) give batteries 80% power in 30 minutes, the BMW i3 or the Nissan Leaf can take around 4 or 8 hours to get fully charged. Although charging is cheaper than gasoline, it takes more than 20 times as long. When fully charged, electric vehicles can maintain 160-500k). EVs have the benefit of flexible charging. Since the electric grid is in close proximity to most locations where people park, they can charge overnight at a residence, as well as at a multi-unit dwelling, workplace, or public charging station when available. (source: Hydrogen fuel cell us electric cars: what you need to know but couldn’t ask)


Hydrogen fuel cell vehicle

The car will gain 320-405km of range for each fill of hydrogen. It takes only 3 to 4 minutes for a hydrogen car to fill up. Although refueling an Fuel Cell Electric Vehicles is very similar in time to an internal combustion engine vehicle, the refueling options are very limited, and an expansion of the refueling infrastructure is very expensive compared to the expansion of the EV charging infrastructure, mainly because there is already an electrical grid in place in most areas where cars typically need to be charged. (source: Hydrogen fuel cell us electric cars: what you need to know but couldn’t ask)

Safety Issues


Petrol or Diesel vehicle

The technology of gasoline vehicles has been significantly developed. There are many car devices to prevent accidents, for example, an anti-lock braking system, advance warning system, lane change assist, and electronic stability program. Although gasoline vehicles account for most traffic accidents in the world every year, people are more willing to believe in mature technology when choosing between electric vehicles and gasoline vehicles.


Electric vehicle

Most battery-electric vehicles are structurally safer than conventional cars. Overall, they have fewer components needed to run the vehicle, meaning less wear and tear and less space used within the vehicle’s infrastructure. This allows a rethink of some of the safety features we take for granted today and puts ICE cars at a disadvantage.


Hydrogen fuel cell vehicle

As new technologies, fuel cells, and hydrogen have some associated safety concerns that have to be addressed. The two prime dangers from fuel cell and hydrogen-powered vehicles are the danger of electrical shock and the flammability of the fuel. Both the electrical current and the flammability concern of the fuel translate into the design needs for the vehicle itself as well as the requirements for structures intended for the storage and refueling of these vehicles.

The major companies profiled in the hydrogen fuel cell vehicle market share include Toyota,, Honda, Hyundai, and BMW. Volkswagen and Audi have stopped their research in this area.

Toyota Mirai (Japanese for “future”) is a medium-sized hydrogen fuel cell vehicle (FCV) produced by Toyota, which is one of the first batch production and commercial sales of FCV vehicles. Mirai appeared at the Los Angeles Auto Show in November 2014. As of December 2019, global sales totaled 10250 units. The highest selling markets are 6200 in the United States, 3500 in Japan, and 640 in Europe.

Source From: Car and Driver

The automaker sees the futuristic car as a bridge to a future society where hydrogen technology is hard to achieve. The goal is not sales. They have a bigger goal and are contributing to a carbon-neutral society. Toyota’s chief technology officer said: “In the bigger story of reaching a carbon-neutral society, we are just trying to spread a product, or in other words a tool, that makes it easier for as many people as possible to use hydrogen in their daily lives.” (River Davis,2020)

The Honda Clarity is a nameplate used by Honda on alternative fuel vehicles. The 2021 Clarity Fuel Cell is a very different kind of Honda. Despite its advanced propulsion methods, the Clarity still functions quite nicely as a mid-size family sedan, and its fuel efficiency is beyond reproach. If the customer lives in California, Honda will lease them the hydrogen fuel-cell model and give them credit for up to $15,000 worth of fuel. The Clarity’s onboard fuel cell holds enough hydrogen for up to 360 miles of driving (2021 Honda Clarity, 2021)

The 2021 NEXO Fuel Cell from Hyundai is the world’s only fuel-cell SUV. The Nexo is the first dedicated hydrogen-powered SUV, with an estimated range of 380 miles it is the highest of any fuel cell vehicle on the market.⁠ Currently, NEXO Fuel Cell is available only at select California dealers. Fueling NEXO Fuel Cell is as easy as pumping gas. And in 5 minutes or less of refueling, customers have the highest range of any fuel cell vehicle on the planet.

BMW is one of a few automakers working with hydrogen fuel cell technology, which has been collaborating on it with Toyota, a leader in the development of hydrogen powertrains, since 2013. BMW has confirmed that its i Hydrogen Next technology will go on sale in 2022, with a new model, based on the current X5. Dr. Jurgen Guldner, BMW’s VP for hydrogen, said that “We see fuel cells helping us to convert all our cars to zero emissions over the next two decades. Fuel cells will add to our spectrum of powertrains for the future. We don’t see it as a competition for the battery electric vehicle, but as a further offer to our customers.” (source: https://carbuzz.com/news/bmw-refuses-to-give-up-on-hydrogen)

Volkswagen Group CEO, Herbert Diess, announced that the German car-making giant would stop funding its fuel cell program because FCEVs aren’t seen as competitive in the next decade. The decision has been taken within the group to focus entirely on battery-powered electric vehicles which are seen as a much sounder bet for the near future. (Andrei Nedelea, 2020).


Audi is discontinuing its development of hydrogen-powered cars. This was revealed in an interview with the chair of the board Markus Duesmann in the German newspaper De Zeit. He says he sees no future for hydrogen cars and fuel cells because it will be virtually impossible to produce enough CO2-neutral hydrogen for a substantial number of passenger cars over the coming decades. (Maurits Kuypers, 2020)

HyPoint is a US-based startup developing a hydrogen fuel cell system with zero carbon dioxide emissions and more efficient energy performance for the air transportation and urban air mobility sectors. HyPoint’s patented Turbo Air-Cooled Fuel Cell Systems offer a lightweight and more straightforward design than liquid-cooled systems, which allows them to achieve specific power and energy density. This solution also increases operational time and utilization rate while decreasing operating costs for any flying platform (5 Top Hydrogen Fuel Technology Startups Impacting The Energy Industry, 2020).

Enapter is a German startup building a patented, modular hydrogen generator that is ready-to-use across various industrial and mobility applications. Clients have to simply fill EL 2.1, an AEM electrolyzer, and connect the water and electricity to start producing hydrogen on-site. The startup also provides an energy management system to predict energy generation, storage, and transmission (5 Top Hydrogen Fuel Technology Startups Impacting The Energy Industry, 2020).

PowerUp Energy Technologies – The US-based startup produces a portable fuel cell-based smart generator, SMARTGEN, to produce power onboard sailboats, yachts, recreational vehicles (RVs), and eventually, for power backup. SMARTGEN combines several technologies into one portable box, including fuel cells, lithium-ion batteries, and supercapacitors. Their fuel cells allow customers to produce electricity directly from hydrogen. Additionally, the company’s batteries and supercapacitors provide an option to store power generated by solar panels and wind turbines (5 Top Hydrogen Fuel Technology Startups Impacting The Energy Industry, 2020).

HyTech Power is a US-based startup that offers hydrogen energy solutions for internal combustion engine-based vehicles. The startup’s proprietary internal combustion assistance (ICA) technology provides significant fuel savings in diesel engines. This on-demand hydrogen generation and injection retrofit system are designed for multiple off-road and on-road diesel engine applications. Besides, its aerospace-grade engineered systems improve fuel efficiency too (5 Top Hydrogen Fuel Technology Startups Impacting The Energy Industry, 2020).

HYON is a joint venture company formed by three hydrogen energy solutions providers. Nel hydrogen solutions cover the entire value chain, including hydrogen production technologies and the manufacturing of hydrogen fueling stations. PowerCell Sweden produces fuel cell stacks and systems with improved energy density for stationary and mobile applications. Hexagon Composites is a supplier of composite pressure cylinders and systems for gas applications. HYON offers hydrogen production, fuel cells, storage, and transportation for the automotive, maritime, off-grid energy, and power-to-gas industries with these inputs (5 Top Hydrogen Fuel Technology Startups Impacting The Energy Industry, 2020).

Hydrogen is being used experimentally as a vehicle fuel, not only because it oxidizes to harmless water, but also because it has a higher energy density per unit of weight than CNG or methane. One of the other positive characteristics of hydrogen is that it disperses very quickly, so there is some risk to use hydrogen in the car. (source: “Safety issues regarding fuel cell vehicles and hydrogen fueled vehicles”)

Electrical Shock

The way that over 350V is required for the drivetrain of fuel cell vehicles presents both an electric shock danger and can become an ignition source for fuel contained in the vehicle or outside materials. Since a lot of the material utilized in vehicular development is metal, with some electrical conductivity level, there is a high potential for electrical deficiencies. This can represent a danger both in normal operations of the vehicle and particularly in mishaps.

In addition to the electric current generated by the fuel cell during its operation, most prototype vehicles have an electrical storage component for acceleration and start up. Most hydrogen fuel cell vehicles store and draw on this additional electricity in form of batteries. Batteries can also represent the additional danger brought on by the presence of acids, to both the electrical system and the fuel system.

Flammability of the Fuel

While being a very clean and energy-dense fuel, hydrogen has the tendency to disperse quickly under normal pressure which causes the need for higher pressure of hydrogen in the fuel transport system than for natural gas. Hydrogen molecules are so small that they can easily escape through miniature holes and can even enter the molecular structure of some steels. In normal operation of the vehicle the slowly escaping hydrogen collects and can form a flammable or even explosive mixture with air. An accumulation of gaseous hydrogen is seen as particularly dangerous in the enclosed passenger or storage compartments of any hydrogen fueled vehicle. (source: “Safety issues regarding fuel cell vehicles and hydrogen fueled vehicles”)


Hydrogen today is transported as a liquid in insulated trailers similar to fuel trucks. Future sources of Hydrogen for fueling stations can be gaseous hydrogen pipelines or reforming Hydrogen on-site from the source-fuels described above. There are issues with Hydrogen storage at the fueling sites and the recognition of hydrogen spills. With fuel cell vehicles there is a big potential for the issue with the electric circuitry in the region of combustible gases.

Parking of the Vehicle

Parking a hydrogen vehicle or other gas-fueled vehicle in an enclosed structure is a serious safety concern as it can lead to a buildup of gas. Hydrogen’s tendency to rise and disperse rapidly makes this the only situation in which small leaks can create hazardous conditions.

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Japan was the first country to adopt a “Basic Hydrogen Strategy” and plans to become a “hydrogen society.” This strategy primarily aims to achieve cost parity with competing fuels such as gasoline in the transportation sector or liquefied natural gas (LNG) in power generation and covers the entire supply chain from production to downstream market applications. (Japan, the new hydrogen nation, 2020). They want to get rid of the dependence on importing Middle East oil. Because Japan has few resources, and the existing resources can not meet the population of 100 million, hydrogen energy is very attractive to Japan. Former Japanese Prime Minister Shinzo Abe has made hydrogen a symbol of Japan’s ability to innovate despite the collapse of its vaunted consumer electronics industry. “Hydrogen energy holds the trump card for energy security and measures to address global warming” (Japan gambles on Toyota’s hydrogen-powered car, 2017).

People think that the first step to building a hydrogen society is to build a hydrogen fueling station, not to inconvenience drivers. The big problem is that companies will not choose to build hydrogen fueling stations without many hydrogen vehicles and people will not choose to buy hydrogen vehicles without many hydrogen fueling stations. The Japanese have special focus on hydrogen fueling stations. They want to increase the number of fueling stations approximately from 111 at present to 581 by 2025 and then to 1,321 throughout Japan by 2030 (Japan, the new hydrogen nation, 2020).

The Mirai, which means “future” in Japanese, is Toyota’s and Japan’s vision of low-carbon transport, a vision entirely different for the battery-powered Teslas edging into the automotive mainstream. The popularity of Mirai still faces many problems. The cost of Mirai is very high, and the assembly time is prolonged. The Mirai is either the automobile’s future or a technological trap about to swallow a prized swath of the Japanese industry. (Japan gambles on Toyota’s hydrogen-powered car, 2017).

“We see fuel cell vehicles as the ultimate eco-car,” says Kiyotaka Ise, Toyota’s head of advanced R&D. “Everyone is saying electric vehicles [are the future], but there is still a long way to go. EVs are far easier to make than FCVs, and there’s still going to be a lot of trial and error. Toyota is putting huge effort into fuel cell vehicles.” (Japan gambles on Toyota’s hydrogen-powered car, 2017).

Top deals for 2020 in fuel cell and hydrogen include:

Nikola Motor CompanyUnited States$250,000,000
BayoTechUnited States$157,000,000
Jiangsu Guofu Hydrogen TechnologyChina$60,000,000
FirstElement FuelUnited States$25,000,000
Energy Observer DevelopmentsFrance$23,730,000
ZeroAviaUnited States$21,400,000
H2 EnergySwitzerland$20,000,000
Hydrogenious LOHC TechnologiesGermany$20,000,000
Cell ImpactSweden$20,000,000

Overall, it’s clear that there is significant potential for the use of hydrogen fuel for motive power in vehicles, and Lions Financial’s focus on providing capital markets financing and business consulting engagements to companies in the automotive and trucking industry puts you in a great position to help drive this industry forward.

Lions Financial specializes in working with companies in the automotive, trucking, engineering, and renewable energy industries. The Hydrogen industry is growing and we support companies in the areas of management consulting and refining business plans for venture capital financing. For companies in the hydrogen industry, we support issues around Due Diligence, Valuations, Mergers and Acquisitions, and Business Exits. 



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