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Honda, GM to jointly produce fuel cell power systems in US from 2020

Honda, GM to jointly produce fuel cell power systems in US from 2020
January 30, 2017
TOKYO – Honda Motor Co Ltd and General Motors Co (GM) will jointly produce hydrogen fuel cell power systems in the United States from around 2020, to cut costs and ramp up output in the hope of increasing take-up of the zero-emission cars. The pair on Monday said they will invest $85 million to add a production line at a GM battery plant in Brownstown, Michigan, and create 100 jobs. Their U.S. investment plan is the latest this month from the auto industry after President Donald Trump urged car makers to raise production in the United States and vowed to cut regulations and taxes to make the U.S. more business friendly. It also comes soon after Trump promised to dismantle U.S. environmental regulations, which may loosen requirements for lower-emission vehicle development and curb green car demand. Honda on Monday said fuel cell vehicles (FCVs) remained central to new-energy cars making up two-thirds of its line-up by 2030 from around 5 percent now, driven by U.S. sales. "The United States is where demand for fuel cell vehicles is going to be among the highest so we've decided to consolidate our manufacturing operations into one location there," Honda spokesman Teruhiko Tatebe said at a joint news briefing in Tokyo. "Both GM and Honda have our respective missions to develop clean energy sources, and we plan to continue these regardless of the political situation." Honda is among a handful of automakers to develop FCVs, which combine hydrogen and oxygen to produce electricity and emit only water. But limited fuelling infrastructure has subdued demand while in the U.S., low petrol prices have pushed consumer preference toward sport utility vehicles and pick-up trucks. Honda has produced just 118 of its Clarity Fuel Cell cars since its U.S. and Japan launch last year at a relatively high price of 7.66 million yen ($66,795). Honda makes that vehicle's components in Japan but on Monday said it would eventually shift production of fuel cell power systems to the U.S. to cut costs. It said it had not decided whether to continue assembling FCVs at home in the longer term. –Reuters