It's clear Hyundai firmly believes in hydrogen fuel cell electric vehicles (FCEVs), despite two big hurdles: refueling infrastructure and cost. The company's first FCEV is expensive, but Johnson said that Hyundai is working on getting the price down to an "affordable price" as it gets ready for mass production and consumer retail "beyond 2015." FCEVs are getting a bit assist in Korea, where the government offers an incentive that cuts the "upgrade cost" in half. Governments in Europe are also providing financial assistance for FCEVs and refueling stations.
Johnson admits "infrastructure development in the US has been slow, thereby limiting any potential [FCEV] demand." To figure out how many H2 Tucsons to potentially bring to the US, Hyundai is currently "investigating potential demand ... in the US market, particularly in California, where most of the H2 refueling infrastructure development has taken place."
You can read Johnson's full brief below.
In the US, Hyundai started a fuel cell vehicle demonstration fleet in 2005. However, infrastructure during demonstration fleet testing is important and the fuel cell station infrastructure in the US still needs the government's financial support. Infrastructure development in the US has been slow, thereby limiting any potential demand. Hyundai strongly believes fuel cells will be one of the important future vehicle technologies globally and we are targeting mass production for consumer retail with an affordable price beyond 2015. Currently Hyundai is investigating potential demand for the Tucson Fuel Cell Vehicle in the US market, particularly in California, where most of the H2 refueling infrastructure development has taken place.
Recently, the European Community (EC) has made plans for infrastructure and vehicle deployment. Many EC municipalities are funding the H2 refueling stations as well as vehicle development. Many municipalities are providing significant amounts of tax exemptions and incentives. In January, Hyundai became the first automaker to begin assembly-line production of fuel cell vehicles, largely targeted for the EU market.
In Korea, the government has initiated fuel cell incentives amounting to around half of the vehicle upgrade cost. Even though the budget is minimal this year, it will be extended to encompass large-scale volume.
Fuel Cell vehicle is a type of electric vehicle that uses hydrogen fuel to generate electricity, rather than using stored electricity from batteries. The generation of electricity from hydrogen requires several major systems including a Fuel Cell Stack, Air Processing Unit, Fuel Processing Unit, Thermal Management System, High Voltage Unit, and other driveline components. Modularization is taking place in all these systems and is allowing for improvements in assembly productivity. Unification of systems allows for a more compact, lighter design, which can also improve overall system efficiency. Modularization also allows for application on different vehicle platforms, from passenger car applications to commercial busses. Hyundai continues to refine and improve its fuel cell system to optimize overall design and modularity.
The Tucson Fuel Cell and the ix35 Fuel Cell rely entirely on hydrogen for propulsion. However, an on-board 24kW lithium polymer battery assists the fuel cell during brisk acceleration, similar to a hybrid vehicle. There are four different driving modes on the Tucson Fuel Cell Vehicle. 1) Fuel Cell Mode: Vehicle is powered only by the fuel cell (such as when cruising). 2) Assist Mode: Vehicle is powered by both fuel cell and battery (such as when accelerating). 3) Charge Mode: Fuel cell charges battery when its charge level is low. 4) Regeneration Mode: Battery is charged by electric motor during vehicle braking.
Hyundai recently became the first automaker to begin assembly-line production of fuel cell vehicles. We plan to make about 1,000 units over the next two years. One of the challenges of this program is the relatively high vehicle cost due to its small scale production. High development costs per unit drive the vehicle price up. If Hyundai produced fuel cell vehicles in larger volumes, the price would be significantly reduced. However, H2 infrastructure in various regions still limits potential sales, thus large scale production will be tempered until the infrastructure catches up with technology development. In the mean time, Hyundai is investigating methods to reduce the vehicle cost further by developing break-through technology, such as low Pt or non-Pt catalyst technology, system simplification, and upgraded system efficiencies.