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Daimler Steps Back From Fuel-Cell Car Development

David Z. Morris
Daimler Steps Back From Fuel-Cell Car Development

Daimler AG head Dieter Zetsche said at an automotive summit in Germany this week that hydrogen fuel cells are no longer a major part of the automaker’s plans for the future. Engineering news site Smart2Zero reports that Zetsche said declining battery costs have made fuel cell vehicles uncompetitive with electric cars.

Daimler has also declared that it will accelerate its development of battery-electric vehicles by three years.

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Zetsche’s statements could signal the wind-down of a 2013 agreement between Ford, Daimler, and Renault-Nissan to jointly develop fuel cell technology. That and other fuel-cell development efforts were premised on the idea that fuel cell powertrains, which use liquid hydrogen fuel, would offer a longer range than electric vehicles.

But electric car makers have since broken through range barriers, even offering vehicles that beat the range of the average gasoline-powered car. Meanwhile, the underlying energy and infrastructure shortcomings of HFCs remain-liquid hydrogen is energy-intensive to produce, and in contrast to cars powered by existing electrical networks, would require an entirely new system of liquid hydrogen production and distribution.

Those challenges have led Tesla Motors CEO Elon Musk to make repeated disparaging remarks about HFC vehicles, calling them “extremely silly,” “incredibly dumb,” “mind-bogglingly stupid,” and, most succinctly, “bullshit.”

Daimler’s move (perhaps more than Musk’s less-than-objective rhetoric), undermines Toyota’s emphasis on fuel-cell cars in recent years. Toyota’s initiative is part of a broader Japanese government plan to create a “hydrogen economy,” but as of February Toyota had only sold 2,840 of its Mirai fuel-cell vehicles worldwide.

Daimler is not completely abandoning fuel cells, though. It will reportedly still produce a limited run of a fuel-cell vehicle, the GLC SUV, starting late this year.

This article was originally published on FORTUNE.com