06-03-2025
Hydrogen hopes shudder amid spate of bankruptcies
Hydrogen trucking startups have faltered, leaving legacy manufacturers to determine whether the energy source has a long-term future in hauling cargo.
Three startups that built fuel cell systems or upfitted them into commercial vehicles — Nikola Corp., Hyzon Motors Inc. and Quantron AG ― have all declared bankruptcy over the past six months.
Nikola, which sold more than 200 fuel cell trucks last year, cited adverse market and macroeconomic conditions when it filed Chapter 11 bankruptcy last month.
Those companies had hoped to follow in the path of Tesla as novel zero-emission vehicle plays, said Sam Abuelsamid, vice president of market research at Telemetry Agency.
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Amid a higher-interest rate climate and a shift in venture-capital interest toward artificial intelligence, 'there was just no way to raise the capital needed to hang on until they were self-sustaining,' he said.
Collectively, the companies' troubles represent a setback to hopes that hydrogen could mature into a clean energy source, particularly in the heavy-duty vehicle applications, in which fuel cell technology offers shorter fueling times and longer ranges compared with battery-electric counterparts.
Legacy manufacturers retain a keen interest in hydrogen. Toyota Motor Corp. unveiled its third-generation fuel cell system in February. The company intends to introduce it in heavy-duty commercial vehicles across the globe.
Hyundai Motor Corp. has 30 of its Xcient-branded fuel cell trucks operating in the Bay Area and 21 more were deployed in December at the manufacturer's Metaplant America in Georgia. Backed by $237 million in government funding, Daimler Truck AG intends to test 100 of its GenH2 trucks on German roads starting at the end of 2026. Volvo Trucks is developing trucks with combustion engines that run on hydrogen. On-road testing is expected to begin next year.
Some of those manufacturers remain bullish on utilizing fuel cells in passenger vehicles, although that tiny market is shrinking. Global fuel-cell EV sales reached a peak of 20,704 vehicles sold in 2022, according to SNE Research statistics. Total sales tumbled to 12,866 in 2024, a drop the firm attributed to dwindling sales of the Hyundai Nexo in the Korean market. Hyundai anticipates unveiling a revamped Nexo this year and expanding its fuel cell commercial vehicle lineup.
Toyota has produced its Mirai since 2014, though sales have been scant. Approximately 28,000 have been sold across 30 countries, the automaker said in February.
On the trucking side, Those manufacturers can rely on sales of their existing diesel trucks and their dealership networks to fund fuel cell developments, said Conrad Layson, senior alternative propulsion analyst at AutoForecast Solutions.
But startups and legacy players alike will be hamstrung by the lack of hydrogen infrastructure across the U.S., he said. The startups 'were on the right path,' Layson said. 'But the biggest challenge remains infrastructure.'
Only 54 public hydrogen fueling stations exist in the U.S., according to Department of Energy records. Only six of those cater to medium- or heavy-duty vehicles, according to a July 2024 report from Resources for the Future, a nonprofit research and policy firm. But the lack of stations is only one part of the shortfall.
Distribution represents a more underappreciated and nettlesome challenge, Layson said. The nation's pipeline networks require new coatings and fittings to reliably carry hydrogen, and those enhancements are 'nonexistent,' he said.
'In order to make hydrogen economically viable, you have to engage in a massive upgrading and replacement of the existing gas pipe network through the country,' he said.
Countries such as China and South Korea have made building out hydrogen networks national priorities. China intends to have approximately 1,200 hydrogen stations online by the end of the year, with a concentration along freight corridors, according to Interact Analysis. South Korea has 159 and Japan has 161, according to the firm's estimates.
Infrastructure projects in the more fledgling. In October 2023, the Energy Department awarded $7 billion in funding to seven U.S. regions expected to form 'Hydrogen Hubs,' clusters of infrastructure designed to support hydrogen supply and demand in multiple industries.
Yet hydrogen's broad prospects under the Trump administration remain a question mark — and dependent on the fate of a tax credit included in the Inflation Reduction Act known as 45V. The credit is worth as much as $3 per kilogram of clean hydrogen produced.
But 'most folks who would otherwise apply for this credit will wait until there is less uncertainty,' said Alan Krupnick, a Resources for the Future senior fellow. 'I think the financial community is also probably waiting for uncertainties to be resolved.'
The industry has sought to keep the tax credit. On Feb. 18, dozens of organizations and companies, including General Motors and Hyundai, signed a letter to congressional leadership that said 45V is 'essential' for President Trump's 'bold energy dominance agenda.'
Billions in potential investments could be at risk from uncertainty surrounding the future of 45V, the letter said, and jobs could shift from the U.S. to other countries.
'We need to ensure that we do not miss this hydrogen moment,' the letter said.
The moment has been fleeting for the likes of Nikola, Hyzon and Quantron. In many ways, their struggles parallel those of startups in the light-duty EV space such as Rivian and Lucid, Abuelsamid said.
They all went public at a time investors' appetite in zero-emission technology 'almost completely dried up,' he said. 'Their timing was terrible.'
Rivian and Lucid found suitors. Volkswagen will invest as much as $5.8 billion in Rivian in a new joint venture focused on software development. The deal closed in November. Lucid received $1.5 billion from Saudi Arabia's Public Investment Fund in August.
Such benefactors have been harder to come by in the commercial-vehicle sector, in part because sales volumes are lower, and the ability to achieve economies of scale are more difficult, Abuelsamid said.
'As a result, the ability to reach breakeven is more difficult,' he said.
Trucking is not the only transportation sector where hydrogen hopes have been dashed by recent headwinds. Universal Hydrogen, a startup developing conversion kits that would allow aircraft to run on hydrogen fuel, closed in June after depleting its funding. More recently, in February, global manufacturer Airbus said it has delayed plans to develop a hydrogen-powered aircraft until the middle of next decade.
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