01. July 2021 | 12:11 CET
Pure Extraction, Ballard Power, SFC Energy - H2 mobility for commercial vehicles: These are the winners!
The advance of e-mobility associated with the energy transition and the need to decarbonize the economy does not stop at the commercial vehicle segment. However, the battery technology currently gaining acceptance in this sector has decisive disadvantages: it is expensive, has a heavy weight, and charging is time-consuming. For this reason, alternatives are feverishly being sought. Can hydrogen fill this gap? In contrast to suppliers like BYD, who focus primarily on battery mobility, the following companies concentrate fully on hydrogen technology. Who is in the running?
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ISIN: PURE EXTRACTION CORP. | CA74622J1012 , BALLARD PWR SYS | CA0585861085 , SFC ENERGY AG | DE0007568578
"[...] Why should a modular electrolyzer cost more than a motorcycle? [...]" Sebastian-Justus Schmidt, CEO and Founder, Enapter AG
Pure Extraction becomes First Hydrogen - Joining Ballard Power and AVL at the top
The name First Hydrogen means nothing to you? Don't worry, this should change soon because First Hydrogen is getting ready to shake up the market for zero-emission delivery vehicles. Initially founded as a subsidiary of the Canadian Pure Extraction Corp., the Company will be the namesake for the entire group in the next few weeks. And this is the program: using a "best of" approach, the Company plans to produce a prototype zero-emission delivery van based on hydrogen fuel cell technology within just twelve months, leaving all the disadvantages of battery technology behind: short-range, long charging cycles and limited storage space due to the size of the battery packs will be a thing of the past.
To accomplish this, First Hydrogen recently signed agreements with two powerful partners, Ballard Power and AVL. While Ballard Power, as the global market leader, will supply the appropriate fuel cell technology, AVL, the largest private company, has been contracted to develop and test powertrains for the design and manufacture of the prototype based on a proven chassis. Currently valued at CAD 87 million on the stock market, the Company estimates development costs at around CAD 2 million. The fact that there is a market for climate-neutral delivery vehicles can be seen in the StreetScooter from Deutsche Post AG, which has had to extend the in-house production of its electric delivery vehicle until at least 2022 despite losses due to a lack of alternatives. And not only are parcel services such as DHL, Hermes or UPS potential customers, but also online retailers. Amazon or delivery services such as Flaschenpost or Gorillas will (have to) increasingly look for climate-neutral vehicles.
Since First Hydrogen is currently only at the beginning of its development, the shares of the Canadian Company are still to be regarded as speculative at this point. But the shares offer enormous potential. Alone, it is impressive that it has been possible to bring two such respected project partners on board. The current price level still opens up a favorable entry opportunity.
Ballard Power Systems - Positive newsflow, rebranding planned
Recently, a series of positive news has led to a noticeable recovery in Ballard Power Systems, which has come under heavy pressure in the general correction in hydrogen stocks. The Company had recently announced a strategic partnership with US industrial company WL Gore to supply a higher-performance membrane that will significantly extend the life of Ballard's manufactured fuel cells. This was coupled with the announcement that the two companies were working together on further efficiency improvements to achieve higher efficiency and thus lower the cost of fuel cell technology.
In addition, the fuel cell pioneer founded back in 1979 was able to announce the delivery and order of further buses to Wrightbus (London, 20 double-decker buses) and New Flyer (Oakland, California, 20 coaches). After fuel cells from Ballard have already covered more than 80 million kilometers in more than 20 countries since the Company was founded, the entry into series production of fuel cell buses marks the beginning of a new chapter for the Company, which the group also wants to emphasize visually. CEO Randy MacEwen announced in a company press release that the decision had been made to rebrand the Company carefully while retaining its name. It was decided to adapt the Company logo as well as the tagline and the website.
These measures represent a new spirit of optimism in the field of fuel cell technology, which seems to be gradually gaining acceptance after all. At least in the public transport sector, where many battery projects have had to be abandoned due to problems with charging or range in cold weather or unforeseen traffic jams. And in this area, Ballard Power, with over 40 years of experience, is certainly one of the most sought-after suppliers. But Ballard is not idle in the commercial vehicle sector either. Investors are eagerly awaiting the first results of the cooperation with Canada's second-largest automotive supplier Linamar, which was announced in May, and from the tie-up with First Hydrogen as described above. Analysts currently believe that the stock has an average upside potential of around 14%.
SFC Energy - Portable fuel cell technology made in Germany
After the significant downturn in hydrogen stocks a few months ago, many stocks are still well below their highs, such as Plug Power, Nel and Ballard Power. In contrast, the German fuel cell pioneer SFC Energy from Brunnthal in Upper Bavaria came through the crisis better. The shares lost about 30%; however, after announcing the 2025 sales targets of about EUR 350 to 400 million, the share price has almost reached pre-crash levels again.
What distinguishes SFC from other fuel cell manufacturers? First of all, that SFC is not developing its technology for the e-mobility sector. Instead, the focus is on hybrid and decentralized long-term power supply, such as for weather monitoring stations in offshore wind farms or other hard-to-reach locations. Another distinguishing feature of SFC is that the Company produces fuel cells and provides the necessary power electronics, measurement technology, etc., which are required for highly demanding measurements or in critical industrial production. Here SFC can draw on a great deal of know-how.
Positive newsflow, such as the announcement of an in-depth development partnership with GWU-Umwelttechnik GmbH in the field of wind energy, as well as a well-filled order pipeline, currently make the Company a stock market darling. The Company may have a chance to move up to the TecDAX in the not too distant future. For us, SFC Energy is certainly one of the most exciting players in the field of fuel cell technology. By the way, analysts currently see an average share price potential of around 20%.