Audi and Hyundai Motor said they will cooperate on developing fuel cell vehicles. The agreement will give Audi and other brands in Volkswagen Group access to parts that are based on Hyundai’s know-how accumulated from the development of the ix35 Fuel Cell SUV and its successor, the Nexo.
The automakers have entered into a multi-year patent cross-licensing agreement, covering a broad range of fuel cell electric vehicle components and technologies, Hyundai said in a statement on Wednesday.
The agreement covers and benefits both companies’ affiliates, including Kia and Audi’s parent company VW Group, Hyundai said. The duration of the agreement was not disclosed.
The partnership will leverage collective r&d capabilities in fuel cell technology to elevate their presence in the FCEV market.
Audi development chief Peter Mertens said in the statement that cooperation is the smart way to achieve breakthroughs in fuel cell technology.
Audi is responsible for the development of fuel cell technology in the VW Group. The company will also be able to take full advantage of Hyundai's fuel cell parts supply chain.
Hyundai's Mobis parts-making arm last year opened a production system for core components of fuel cell vehicles in Chungju, South Korea. It has annual production capacity for 3,000 powertrain fuel cell complete modules. The modules are comprised of fuel stacks, drive motors, power electronic components and hydrogen fuel supply units. Mobis plans to increase plant's capacity to tens of thousands of modules in the future, depending on market demand.
Fuel cell vehicles, powered by hydrogen tanks and fuel-cell technology that emits nothing but heat and water, are a rival to full-electric cars as an emissions-free, environmentally friendly alternative to gasoline and diesel engines, which are blamed for emitting climate-changing gases and harmful pollutants.
But high prices and the lack of a widespread refueling infrastructure have held back sales.
Hyundai hopes that its cooperation with Audi will create greater demand for vehicles such as its ix35 and bring down costs to make the technology profitable. "We want to provide to our component suppliers more chance and we want to have competition between component suppliers," said Sae Hoon Kim, the head of Hyundai's r&d fuel cell group.
"We also want to make them to have competition with other suppliers, and that competition will bring down the cost."
Kim said that a toughening of European Union carbon emission limits in 2025 would create a need for more hydrogen cars.
Hyundai sold 200 such models last year and expects to sell thousands this year, but Kim said profitability was still far off. "100,000 or 300,000 vehicles per year per company, when that comes, I think we can make money," he said.
Automakers are teaming up to share the cost of developing greener technologies to replace combustion engines as regulators around the world crack down on emissions. General Motors and Honda have a partnership to jointly develop electric vehicles with hydrogen fuel cells that are expected to go on sale in 2020, while BMW is working with Toyota.
Reuters and Bloomberg contributed to this report