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Plug Power to Add 38,400 Square Foot Facility in New York

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Plug Power, Inc. (PLUG - Free Report) has announced to open a new manufacturing facility at Clifton Park, NY with an area of 38,400 square foot. The company is witnessing strong growth in revenues from the core market and in order to meet increasing demand for hydrogen fuel cell, it has undertaken an expansion plan in the region. The facility is expected to be inaugurated on Aug 17, 2018.

The company owned a total of 169,200 square foot facility as of Dec 31, 2017 with 140,000 square foot facility located in Latham, NY and 29,200 square foot facility in Spokane, WA.

The company is continuously focusing on growing its business and customer base, both organically and inorganically. On Jun 6, 2018, Plug Power announced that it acquired American Fuel Cell, founded by ex-employees of General Motors Company (GM - Free Report) . The company develops Membrane Electrode Assembly technology, the key component of a fuel cell that helps to produce power.

Need & Demand for Fuel Cell Technology

Plug Power is expanding its manufacturing capacity to cater to the improving demand from its core material handling market as well as to prepare itself for the rapidly developing on-road vehicle market.

Fuel cell electric vehicles (FCEVs) are more efficient compared with conventional combustion engine vehicles. FCEVs are based on a propulsion system, quite similar to that of electric vehicles in which, where the energy stored as hydrogen is converted into electricity by the fuel cell. The U.S. Department of Energy is focusing on making hydrogen-powered vehicles an affordable, environmentally friendly and a safe transportation option.

To reduce carbon emissions from diesel-powered vehicles, demand for fuel cell electric vehicles is rising by the day. To this end, in California, Governor Jerry Brown announced plans to make 5 million zero-emission vehicles operational by 2030 under his California Sustainable Freight Action Plan. This in turn, boosted the market for fuel cell energy in the state. Also, in this regard, the government has proposed an investment of $2.5 billion, which is expected to build 250,000 vehicle charging stations along with 200 hydrogen fueling stations in California by 2025.

Courtesy of inherent zero emissions, FCEVs are increasingly favored over diesel-powered vehicles. Naturally, the growing popularity of this technology allows fuel cell producers like FuelCell Energy, Inc. (FCEL - Free Report) and Ballard Power Systems, Inc (BLDP - Free Report) are also receiving new contracts to supply fuel cell units.

Fuel Cell Market Outlook

In 2017, a total of 650 megawatt (MW) of fuel cell power was shipped worldwide along with 70,000 of fuel cell units, which generated a revenue of $2 billion. During the 2018-2023 period, the fuel cell market is expected to witness a CAGR of more than 28%, reaching an industry value of $14 billion by 2023 from the base level of $3 billion in 2017. Currently, North America and Europe are the largest user of fuel cell in the global market while, whereas the Asia Pacific market is also expected to witness a high growth rate over the next six years.

Price Movement

In the past six months, shares of Plug Power have gained 6.5% against its industry’s decline of 4.7%.



Zacks Rank

Plug Power currently has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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