Auto giants sign deal to develop fuel cell vehicles

updated 2:56 p.m. ET March 30, 2005

WASHINGTON - General Motors Corp. and DaimlerChrysler AG have signed agreements with the U.S. Department of Energy to develop hydrogen fuel cell vehicles over the next five years, the automakers said Wednesday.

GM, the world’s largest automaker, plans to build a fleet of 40 hydrogen fuel vehicles. Under the program, GM will spend $44 million to distribute the vehicles in Washington, New York, California and Michigan. The Energy Department also will provide $44 million in the deal, which is set to expire in September 2009.

DaimlerChrysler, which has the largest fleet of fuel cell vehicles of any automaker, will invest more than $70 million in its partnership with the Energy Department, the German-American company said.

Under the agreement, DaimlerChrysler will place fuel cell vehicles with consumers who will give feedback on the vehicles’ performance. The company said it already is testing 100 fuel cell vehicles in various locations around the world.

Fuel cells run on the energy produced when hydrogen and oxygen are mixed, rather than using gasoline. The only byproduct of a fuel cell is water. The technology has been used in experimental vehicles and as a power supply for some buildings.

“If our research program is successful, it is not unreasonable to think that we could be approaching commercialization and mass marketing of these kinds of vehicles in maybe 15 years,” Energy Secretary Samuel Bodman said at the National Hydrogen Association’s annual conference in Washington. It coincided with the automakers’ announcements.

Detroit-based GM also announced that Shell Hydrogen LLC will set up five hydrogen refueling stations in Washington, New York, California and along the Eastern seaboard.

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The automaker said the U.S. Army at Fort Belvoir, Va., and Quantum Technologies in Lake Forest, Calif., would provide facilities for GM to store and maintain fuel cells.

President Bush has pushed a $1.7 billion research program to develop hydrogen as America’s next energy source and predicted Americans will drive cars operated by hydrogen-powered fuel cells in two decades.

Most major automakers are developing fuel cells but say the cost of the vehicles and a lack of fueling stations make them unmarketable at this time.

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