Ballard Power goes back to the future with VW fuel cell deal
For some, yesterday’s news from Ballard Power (TSX:BLD) may have had a nostalgic tinge to it.
The Vancouver-based cleantech announced it had signed an agreement with Volkswagen to develop fuel cells in demonstration vehicles. The contract, says Ballard, is valued at between $60-million to $100-million.
CEO John Sheridan explained the reason for the company’s silence in the auto space.
“The announcement of this research agreement with Volkswagen Group, a recognized global leader, is a major step for Ballard both strategically and financially,” he said. “It represents a tremendous ramp-up in our engineering services business following the recent expiration of the five-year automotive non-compete agreement. Ballard’s focus with Volkswagen in this new automotive fuel-cell research program will parallel our continuing work in commercial fuel-cell markets for backup power and material handling — enhancing product durability and performance, while radically reducing product costs.”
Ballard Power soared to attention in the nineties when it was believed that hydrogen fuel cells were the green automotive solution of the future. In 1993, the same year that Ballard IPO’d at $6 a share, the company demonstrated the world’s first zero-emission, fuel-cell bus.
The promise of the Ballard’’s technology seemed both limitless and inevitable, and it was reflected in the company’s share price. By 1997, its stock had soared to $82, as the company received investments from DaimlerChrysler and Ford. Every major car company was developing fuel cell vehicles, from Honda’s FCX to GM’s Sequel.
The inability of fuel cell developers to reduce costs, however, coupled with advances in battery technology began to sway momentum to electric vehicles. By 2005, shares of Ballard had fallen south of $4 and in 2007, it got out of the automotive market altogether
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Cantech Letter founder and editor Nick Waddell has lived in five Canadian provinces and is proud of his country's often overlooked contributions to the world of science and technology. Waddell takes a regular shift on the Canadian media circuit, making appearances on CTV, CBC and BNN, and contributing to publications such as Canadian Business and Business Insider.
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ballard is the stock to buy