With the rush to replace ozone-depleting fossil fuels within vehicles, it brings cheer to the eyes of auto industry watchers, environmental advocates and investors alike to see that alternative fuels are catching with more and more of the big auto makers.
With all the hoopla over stock markets climbing to record levels, one major story may have been lost. Accordingly, some folks may need to be reminded that Vancouver-based Ballard Power Systems (T. BLD) inked a lucrative four-year contract this week with Volkswagen Group.
The deal, valued anywhere from $60 million to $100 million Canadian, is aimed at advancing development of fuel cells for use in powering demonstration cars in Volkswagen’s fuel cell automotive research program.
According to a company news release, work will involve the design and manufacture of a next-generation fuel cell for use in Volkswagen HyMotion demonstration cars. Reportedly, Ballard engineers will lead critical areas of fuel cell product design – including the membrane electrode assembly, plate and stack components – along with testing and integration work.
It’s a case of Ballard doing well by doing good: recently, Ballard has made lots of headway in developing and bringing to market its commercial fuel cell products, with average product cost reductions of 60% and the product being proven more durable over the years. Sales of Ballard’s clean energy fuel cell products have also been accelerating, with a 30% cumulative annual growth rate in revenue since 2010.
The "Das Auto" deal follows on the heels of a similar deal earlier this past week, with Anglo American Platinum Limited, involving a $4-million investment in Ballard through its PGM Development Fund, to support continued commercial advancement of the Company’s fuel cell products in target market applications.
Ballard Power Systems, Inc., founded in 1979, is a global leader in proton exchange membrane fuel cell technology, and a company that boasts having designed and shipped close to 150 megawatts of hydrogen fuel cell technology to date.
The company also trumpets its multi-market growth focus in fuel cell products. This drives greater revenue and margin potential, while lowering risk for all stakeholders.
"Fuel cell applications," says the company website, "are expected to broaden in the mid-term, although our focus today remains sharply on commercial opportunities in backup power, distributed generation, material handling and bus applications."
Ballard began developing fuel cells in 1983, and since then, has entered into a number of strategic alliances related to fuel cell R&D, including an alliance with Daimler AG and Ford Motor Company. The VW deal is just the latest in a string with major car makers.
Whether because the initial excitement died down since the Volkswagen contract was announced on Wednesday, Ballard stock took a downturn on Friday, losing nine cents, or 7.4%, in late-day trading, to $1.13, still in the upper half of a 52-week range which peaked at $1.59 on March 13 of last year, before sinking to a gully of 58 cents on Christmas Eve. It remains to be seen how much of a push the Volkswagen deal gives Ballard shares in the future – and how far into the future.
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