Fuel Cells Technology: Implications for Future Automotive Production

Fuel cells anyone? Plenty of places are working to get the edge on fuel cell technology, hoping their efforts will pay future dividends in new business investment and jobs.

First,what is the fuel cell and what are the implications of this technology for future automotive production?

A fuel cell is an electrochemical device that combines hydrogen fuel and oxygen from the air to produce electric power. The technology has actually been around for a while. Because of their efficiency, reliability, and compactness, fuel cells were key players in the Apollo space program (and continue to be used today on Space Shuttle missions for both electricity and water production).

How will fuel cells impact the car of the future? Although it may look the same on the outside, the fuel-cell automobile will be a very different one from the internal-combustion vehicles we now drive. In addition to a totally different power source, fuel-cell automobiles will feature a drive train that has little in common with today's cars. And other parts of the car's systems which are currently mechanical in nature (e.g., steering, braking) will be more electronic in nature.

What are the production requirements of vehicles using fuel cell technology? It's actually a different vehicle than we see toay and it would likely need to be manufactured in a radically different way from today's cars. There is a real question of how relevant today's assembly and subassembly processes and plants will be to future automobile production. If existing plants (both final manufacturing and submanufacturing) cannot be easily retooled, there arises the issue of whether to scrap them and build close by or to pick up and start over elsewhere. This could impact many communities across the country and internationally for that matter.

Where are fuel cell companies located today? The fuel-cell industry is currently scattered. Globally, the industry has a more significant presence in the United States, Canada, Europe (notably Germany), and Japan. Fuel-cell developers and key suppliers to the industry are dispersed throughout most of the regions of the United States. This is largely due to the diverse historical roots of these companies (traditional automotive, chemical, aerospace, energy, and electronic industries, plus offshoots of research facilities, specialty players, etc.).

So, what are the implications of fuel cell technology on future automotive production?

Here is how the experts at Deloitte and Touche size the situatiion up.

Existing locations would be favored if:

• They are consistent with the optimal facilities network
• Existing plants can be effectively retooled
• The critical mass of industry skills and intellectual capital is deemed a strategic advantage
• These areas aggressively transition themselves to meet the industry's new needs

New locations would be favored if:

• They are consistent with the optimal facilities network
• They can prove their ability to meet the industry's critical location factors
• They build the required infrastructure (physical and intellectual) and aggressively court the industry

Economic developers are already chasing the fuel cell industry. What's being done? Industry-supporting programs are being established at a rapid pace, and include fuel-cell associations, research initiatives, education programs, demonstration projects, and incentives. Some states with existing or recently announced programs include Michigan, New York, Ohio, Connecticut, and California. In some instances, these programs are part of a larger interest in supporting alternative energy and a cleaner environment. But in the cases of Michigan and Ohio, the focus is more specific; both states' governors have cited their existing auto plants in supporting the new programs.

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