Another Day, Another Hydrogen Transportation Failure, This Time Quantron & IKEA

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A 12 months in the past, whereas assessing numerous organizations that had reached the terminus of the Odyssey of the Hydrogen Fleet six act tragicomedy, I identified the awful, horrible, very bad, no-good decision the Austrian department of IKEA had made to purchase Quantron hydrogen step van supply vehicles. Since then, I’ve been giving strategic steerage out freely — and seemingly handled as price each penny — to transportation car producers like New Flyer to ditch their hydrogen traces and focus solely on battery electrical.

The explanations are easy. Each hydrogen car a agency sells seemingly causes them to not promote three battery electrical autos. That’s as a result of hydrogen shopping for corporations inevitably find yourself actually sad with them. The hydrogen could be very costly and remaining that manner. The hydrogen is high-carbon emissions and isn’t altering. The hydrogen refueling stations don’t work reliably in any respect, out of service way more hours than they’re pumping the fuel. The autos themselves price about 50% extra to take care of than battery electrical ones.

Sad clients are clients who will decide a special agency to purchase from subsequent time.

Additional, attempting to do complicated and costly hydrogen autos and battery electrical makes the producer lose concentrate on making the most effective battery electrical autos attainable. They cut up capital and useful resource investments over the loser — hydrogen — and the winner — battery electrical — as a substitute of simply spending it on the one. Hydrogen buses price much more to fabricate and repair than battery electrical and all the time will, as a result of battery electrical are a lot less complicated. That signifies that any agency promoting hydrogen buses can have much more individuals dedicated to them than battery electrical as a ratio of autos delivered. A agency that has hydrogen autos in its secure can have dearer battery electrical autos in consequence, because the battery division will likely be consuming among the hydrogen overhead.

It additionally signifies that they’re promoting inferior electrical autos into markets the place Chinese language corporations are very aggressive, even with tariffs. For bus manufacturing corporations like New Flyer in North America and Solaris in Europe, they need to be ceding the lifeless finish hydrogen market to rivals who need to go stomach up as an intentional technique, in order that they’ll maintain market share away from BYD and Yutong, who’re actively promoting. BYD is selecting up orders for a whole bunch of electrical buses at a time in North America, and the 2 corporations between them delivered extra battery electrical buses than Solaris’ total supply quantity for 2023.

And, in fact, their gross sales individuals will take a look at the larger sticker value per unit for hydrogen autos and be incentivized to promote extra of them as a substitute of low-cost battery electrical autos. That is one other strategic blunder and can trigger a lack of extra battery electrical gross sales. They are going to be proposing as many hydrogen autos as attainable in each tender with the hope of larger bonuses, as a substitute of maximizing battery electrical car gross sales.

The results of that is that any transportation producer promoting hydrogen buses at present will lose market share yearly to BYD, Yutong, different Chinese language pure performs and corporations which do joint ventures with Chinese language corporations to place a Western shell and model on a Chinese language battery electrical drivetrain. It’s extremely brief sighted and dangerous technique.

Producers with hydrogen and battery electrical choices are deliberately creating the circumstances for their very own decline in market share and even chapter.

And so, to Quantron. Once I wrote about IKEA’s terribly dangerous option to pursue silly Austrian governmental subsidies for hydrogen refueling and supply vehicles, Quantron’s electrical equivalents solely had 200 kilometer ranges. That’s for the standard step van. IKEA had purchased a bunch of those inferior step vans from Quantron, and so they weren’t ample for the minority of longer vary deliveries.

As a substitute of taking a look at distributors who had been delivering greater high quality electrical vans, IKEA stored shopping for from Quantron, selecting the hydrogen model of their step van, with a 400 kilometer vary. In the meantime Mercedes eSprinter is on the market for €60,000 and has a 400 km vary.

What was IKEA paying for Quantron hydrogen vans? Nearly 1,000,000 euros per van, as a result of they had been additionally shopping for hydrogen refueling functionality. It made completely zero sense, however these Quantron gross sales individuals had been extremely motivated to promote as a result of they’d get larger bonuses. Even shopping for Quantron battery electrical step vans made no sense as Mercedes’ product was about €8,000 euros cheaper, so the native IKEA govt clearly was not notably good at procurement.

All of that is enjoying out precisely as anticipated. Quantron filed for bankruptcy on October thirtieth, 2024. Which means the 90 staff of the agency — be aware the small quantity attempting to assist each the a lot less complicated battery electrical drive prepare and the far more complicated hydrogen one — are out of labor, and sure the 350 within the Quantron ecosystem are at menace of shedding their jobs except their corporations can discover them extra gainful employment on one thing that truly is smart.

What does this imply for IKEA? Effectively, the 5 Quantron gasoline cell autos they obtained final 12 months are stranded now, with none group to service them or purchase elements from. The 40 extra hydrogen vans they’d on order from Quantron have dissolved right into a puff of water vapor, so their plan for fleet decarbonization, regardless of how boneheaded, is upended as effectively. And the 56 battery electrical vans with 200 km ranges which they purchased from Quantron are stranded too, so their total supply fleet is now a upkeep nightmare with no residual resale worth. At the very least the electrical vans are straightforward to take care of and pretty dependable.

I’m certain the producers who make hydrogen step vans in Europe — Stellantis, Hyvia and VDL — will likely be lining as much as attempt to take the IKEA hydrogen gasoline cell step van orders for themselves, as a substitute of taking a look at Quantron and realizing that it’s an abject lesson in why their methods are damaged.

What ought to IKEA Austria do? It ought to rethink its technique. It ought to acknowledge that battery electrical step vans are fully match for function, so long as they don’t limit themselves to producers with inferior ones. They need to write off the 5 hydrogen vans they’ve in addition to the hydrogen refueling station.

They need to recast their fleet decarbonization technique as fully battery electrical, and begin ordering battery electrical step vans from Mercedes or BYD. They need to run their Quantron battery electrical vans till they fall over after which discover second lives for his or her batteries and scrap the remainder. They might want to do a whole depreciation of all of their battery electrical and hydrogen fleet this 12 months, in fact.

They need to in all probability rethink the employment of whoever made and offered the terrible, horrible, very dangerous, no-good resolution to purchase the whole lot from Quantron after which make it worse by shopping for hydrogen vans as effectively. They clearly have very restricted analytical or strategic abilities, coupled with too good gross sales abilities. That’s a harmful mixture.