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February 26th, 2024 | 07:00 CET

Plug Power, First Hydrogen, Daimler Truck - Hydrogen: the game changer in transportation

  • Hydrogen
  • Electromobility
  • fuelcell
  • Batteries
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The rapid development of electromobility has undoubtedly brought many advantages. However, there are some questions regarding its suitability for use in commercial transportation. The issues concerning the weight of the batteries, the long recharging time, and the limited range cannot be ignored. In view of these facts, it is questionable whether electric vehicles can completely replace diesel fuel in commercial transportation. There is a need for further technological advances, such as hydrogen propulsion. Although hydrogen has not yet received the same level of attention as electric vehicles, its potential suggests that it can solve the current problems.

time to read: 4 minutes | Author: Armin Schulz
ISIN: PLUG POWER INC. DL-_01 | US72919P2020 , Daimler Truck Holding AG | DE000DTR0013 , First Hydrogen Corp. | CA32057N1042

Table of contents:

    Plug Power - Good news ahead of the quarterly figures

    The good news continues for Plug Power. The Company supplied portable liquid hydrogen filling stations to various customers in the public transport and logistics sectors. The Group has thus expanded its product range to include mobile filling stations for hydrogen vehicles. A recently concluded contract with a leading US automobile manufacturer provides for the entire material transportation fleet to be equipped with Plug fuel cells. In addition, Plug Power is installing the hydrogen infrastructure, which consists of 2 liquid hydrogen tanks and over 10 hydrogen distributors.

    Plug Power has also expanded its partnership with Uline, which includes the integration of an expanded hydrogen infrastructure and the purchase of 250 fuel cell forklifts for 4 additional sites. In total, Uline plans to operate 520 fuel cell vehicles and 34 refueling stations at 10 locations. The first green hydrogen production plants are now also up and running and have already supplied their first customers. The Company has announced a cost reduction plan to save over USD 75 million annually to improve financial performance.

    Although recent developments and partnership expansions are promising, securing long-term financing remains a critical challenge for Plug Power. The Company is seeking to obtain a loan of around USD 1.5 billion from the US Department of Energy and is also looking to sell USD 1 billion worth of new shares. On March 1, Plug Power will publish its financial results for the fourth quarter and the 2023 financial year. The outlook is likely the most important, as the good news will only be reflected in the results for the first quarter. The share was recently under pressure again and is available for USD 3.01.

    First Hydrogen - Successfully developing a niche

    First Hydrogen has focused on the development of light commercial vehicles using the best-of approach and is in the process of expanding its value chain. A study carried out by Sacré Davey Engineering shows that the Company is serving a gap in the market. It sees a considerable market for hydrogen-powered light commercial vehicles (FCEV) in North America, where demand could rise from 6 million vehicles to over 8 million by 2035. This growth is mainly driven by stricter environmental regulations. With an expected market value of USD 1.4 trillion for green hydrogen by 2050, as predicted by Deloitte, First Hydrogen is positioning itself as a leader in realizing a low-carbon future.

    The Company is particularly focused on building green hydrogen production facilities in Québec and is highlighting the advantages of its FCEVs over BEVs, including longer range and shorter refueling times. Most recently, Wales & West Utilities (WWU) in the UK began testing hydrogen-powered demo vehicles. WWU's fleet is in use all year round to provide gas network services. Especially in winter, electric vehicles have problems at low temperatures. This is not the case with hydrogen-powered vehicles. As the infrastructure for hydrogen filling stations is insufficient, the Company is working with Protium, which supplies the green hydrogen, and Hyppo Hydrogen Solutions (HHS), which provides the refueling system.

    This constellation has resulted in a partnership. The parties aim to build a functioning hydrogen ecosystem to ensure green hydrogen's flexibility and rapid availability. With a mobile refueling facility, the tests can be carried out anywhere and eliminate the main barrier to the introduction of hydrogen vehicles. To learn more about First Hydrogen, watch the recording of the Company presentation from the 10th International Investment Forum that took place on February 21. The share has been dragged down in the wake of the negative environment for hydrogen and is currently trading at CAD 1.48. Last year, the share price peaked at CAD 4.99.

    Daimler Truck - Increased commitment to hydrogen

    In the world of commercial vehicles, Daimler Truck is at the forefront of the sustainable mobility revolution as a leading manufacturer. While the automotive industry is increasingly dedicated to zero emissions through electric drive, Daimler Truck has now also turned its focus to hydrogen technology to shape a clean future for commercial transportation. To this end, the Company joined forces with Mitsubishi Fuso and Toyota's Hino last year to develop innovative mobility solutions, particularly in the Asian market, which offers significant growth potential.

    Daimler Truck has shown that it is serious about enabling a zero-emission future in transportation with the launch of its GenH2 truck, which is based on hydrogen fuel cells. In addition, the H2ICE technology (hydrogen internal combustion engines) is being further developed. The collaboration with Volvo on fuel cell development signals a cooperative approach to the challenges of sustainable mobility. Despite the high costs associated with the transition to alternative energies, the Company seems determined to achieve cost efficiency and rapid scalability of these new technologies.

    A potential cooperation for hydrogen deliveries to Europe with the Emirati state-owned company Masdar underlines Daimler Truck's commitment. The Group's financial strength, reflected in its impressive free cash flow yield, forms a solid basis for further research and development in the field of hydrogen. Even in the challenging year 2023, more vehicles were sold than in the previous year. The Company sold a total of 526,053 vehicles, which represents an increase of around 1%. Sales in the large US market were up 4%, while sales in Europe and South America were weaker. The good news has caused the share price to peak at EUR 37 since mid-January. One share is currently available for EUR 36.67.

    Even though the hydrogen market is under pressure due to the problems of major players such as Nel ASA and Plug Power, the growth opportunities are immense. Plug Power has recently reported positive news, but the financial situation is still dangerous. Things are going better at First Hydrogen, which has its light commercial vehicles with hydrogen drive in test operation. This positioning has opened up a niche market. So far, the test reports have been consistently positive. Daimler Truck has also switched from a purely electric solution to hydrogen in order to be able to offer its customers the appropriate solution depending on the application.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.

    For this reason, there is a concrete conflict of interest.

    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

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    Der Autor

    Armin Schulz

    Born in Mönchengladbach, he studied business administration in the Netherlands. In the course of his studies he came into contact with the stock exchange for the first time. He has more than 25 years of experience in stock market business.

    About the author

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