The Volvo Group and Daimler Truck AG, based in Sweden and Germany respectively, announced that the two companies are planning to work as a team to seek solutions for sustainable transportation. The preliminary nonbinding agreement signed April 21 by both commercial-vehicle manufacturers established the new joint venture with the intention of developing, producing and commercializing fuel-cell systems for heavy-duty vehicle applications and other use cases.
According to the preliminary agreement, Daimler will consolidate all its current fuel-cell activities in the joint venture. The Volvo Group will acquire 50% in the joint venture for approximately 0.6 billion euros. A final agreement is expected by the third quarter of the year, with closing planned by the end of the year. All potential transactions are subject to examination and approval by the responsible competition authorities.
The common goal for both companies is to offer heavy-duty vehicles with fuel cells for demanding long-haul applications in the second half of the decade. The fuel cells would convert fuel, in this case hydrogen along with oxygen from the air, into electricity to power an electric motor to propel a vehicle.
“Truly CO2-neutral transport can be accomplished through electric drive trains with energy coming from either batteries or by converting hydrogen on board into electricity,” said Martin Daum, chairman of the board of management for Daimler Truck AG.
“Electrification of road transport is a key element in delivering the so-called Green Deal, a carbon-neutral Europe and ultimately a carbon-neutral world,” said Martin Lundstedt, Volvo Group president and CEO. “Using hydrogen as a carrier of green electricity to power electric trucks in long-haul operations is one important part of the puzzle, and a complement to battery electric vehicles and renewable fuels.”
The Volvo Group and Daimler Truck AG will be 50/50 partners in the joint venture, which will operate as an independent and autonomous entity. The two companies will continue as competitors in all other areas of business. Joining forces will decrease development costs for both companies and accelerate the market introduction of fuel-cell systems in products used for heavy-duty transport and demanding long-haul applications.
“For trucks to cope with heavy loads and long distances, fuel cells are one important answer and a technology where Daimler has built up significant expertise through its Mercedes-Benz fuel cell unit over the last two decades,” Daum said. “This joint initiative with the Volvo Group is a milestone in bringing fuel-cell-powered trucks and buses onto our roads.”
Lundstedt noted that the collaboration between the two companies will speed the development of the desired technology, benefiting not only customers, but society as a whole.
“By forming this joint venture, we are clearly showing that we believe in hydrogen fuel cells for commercial vehicles,” Lundstedt said. “But for this vision to become reality, other companies and institutions also need to support and contribute to this development, not least in order to establish the fuel infrastructure needed.”
To enable the joint venture, Daimler Trucks is bringing together all group-wide fuel-cell activities in a new Daimler Truck fuel-cell unit. Part of this bundling of activities is the allocation of the operations of Mercedes-Benz Fuel Cell GmbH, which has longstanding experience in the development of fuel-cell and hydrogen storage systems for various vehicle applications, to Daimler Truck AG.
The joint venture will include the operations in Nabern, Germany (currently headquarters of the Mercedes-Benz Fuel Cell GmbH), with production facilities in Germany and Canada.
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Volvo, Daimler form joint venture to produce fuel cells
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