General Motors And Honda Partner Up On Fuel Cells

General Motors (NYSE:GM) and Honda (NYSE:HMC) have announced a manufacturing joint venture that will mass produce an advanced hydrogen fuel cell system to be used in future vehicle models. The companies equally split $85 million in investment for the new manufacturing venture, called Fuel Cell System Manufacturing LLC. The joint venture was announced Monday in Detroit at a news conference attended by Michigan Lt. Gov. Brian Calley.

GM and Honda approved the project in late December. The project is the auto industry’s first joint venture for fuel-cell manufacturing. The joint company will have a board of directors, including three executives from each company with a rotating chairperson. The appointment of a president and executive vice president will also rotate between the companies.

The new company will operate inside GM’s battery pack assembly plant in Brownstown Township in southeast Michigan. According to the announcement from the companies, the work is expected to create nearly 100 jobs, including up to 70 jobs in Brownstown. The jobs figure also includes engineering and other positions. On Monday, the Michigan Strategic Fund Board voted to approve a $2 million performance-based grant to back the venture.

Dan Nicholson, GM’s vice president of global propulsion systems said in a statement, “I think we can safely say that today’s announcement officially marks the arrival of fuel cells. They’re not a science project anymore; they’re a mainstream alternative energy choice.” Fuel cell vehicles can run on renewable hydrogen from wind and biomass, with water vapor as the only emission. GM has not committed to using fuel cells in a vehicle for retail customers, but could have other uses for them like aerospace and military applications.

Honda plans to use the fuel cell systems in its next-generation fuel cell vehicle. Toshiaki Mikoshiba, president of Honda North America Inc. and chief operating officer of the North American Region for Honda Motor Co. Ltd. said, “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.” The new hydrogen fuel-cell system will be used in vehicles starting around 2020.

The carmakers have already been working together on fuel-cell development through a partnership announced in 2013. That partnership involved a long-term agreement to co-develop a next-generation fuel cell system and hydrogen storage technologies. Through the partnership, the companies integrated development teams and shared intellectual property regarding hydrogen fuel cells.