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Toyota & Hino Team Up to Develop Hydrogen Fuel Cell Trucks

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Toyota Motor Corporation (TM - Free Report) recently announced the decision to manufacture a heavy duty Class 8 hydrogen fuel cell electric truck for the North American market in collaboration with its subsidiary, Hino Motor Co, a Japanese commercial vehicle manufacturer.

Per the agreement, the Class 8 trucks will integrate Toyota-owned Hino’s recently-introduced XL series tractor with Toyota’s invincible fuel-cell technology to provide an emission-free big rig. Toyota has not yet detailed the operational plans for the truck but the first prototype is expected to be ready for testing in the first half of the next year.   

Announced earlier this year, the companies are also partnering on a 25-ton fuel cell electric truck for the Japanese market that goes into testing in the first half of 2021. The new alliance will strengthen Toyota’s existing tie-up with Hino and bring it to the North American market, though the two trucks will not be identical.
 
Toyota’s hydrogen fuel cell big rigs developed with truck maker Kenworth have been undergoing rigorous testing by hauling freight between the Los Angeles and Long Beach ports since 2017. The company plans to expand its line-up there by next year. A large-scale hydrogen fuel station is under construction at Toyota’s facility at the Port of Los Angeles.

Benefits of the Alliance

The Hino XL series powered with Toyota’s proven fuel-cell technology will create an innovative, efficient and competent product with no carbon emissions. The collaboration of Toyota’s breakthrough fuel cell powertrain with Hino's heavy-duty truck experience is a wining deal for customers as it offers them commercially viable, extended range, zero emission vehicles.
 
Since 2017, the Japanese automaker has fancied developing a possible fuel cell semi truck to underscore its dedication to hydrogen fuel-cell technology. In 2020, Toyota officially stated that it will develop a production semi truck that runs on fuel cells.

This partnership is a game changer for both companies as it in sync with their goal of providing durable vehicles equipped with cutting-edge technology to customers.

Hydrogen Fuel Cell vs Battery Power

Amid the heightening climate change concerns, there is an emphasis by key markets around the globe to restrict carbon emissions from cars and trucks, which is contributing to development of both battery-enabled and hydrogen-fueled vehicles that might be widely available in recent times.

Hydrogen fuel cells, which generate electricity for the truck's motors through the chemical combination of stored hydrogen and atmospheric oxygen, with the emission of only water as a by-product, have been always propagated as a green vehicle option. This is because hydrogen fuel cell powertrains do not add additional weight to the vehicle like battery systems and can be refueled in lesser time than taken in recharging batteries.

However, this technology has not been widely adopted by the market due to the lack of hydrogen fuel stations and extravagant components needed for the zero-emission powertrain making them a less viable option compared with battery-powered electric transportation.

Toyota has long touted hydrogen fuel cell powered vehicles as the ultimate green transportation, and views this technology as a more efficient alternative to battery power for electric cars, embraced by many rivals as a zero-emission alternative to gasoline vehicles.
 
The global automaker retails Mirai fuel cell cars in California, Japan and other global markets but has now moved to hydrogen-enabled heavy-duty vehicles, particularly long-distance big rigs.

Tesla’s CEO Elon Musk has always condemned hydrogen “fool cells”, fussing about its incompetence relative to battery technology. However, auto giants like Toyota, Hyundai Motor and Daimler and engine maker Cummins have shifted their focus to hydrogen-enabled trucks.

Competition is Rife

The Toyota-Hino alliance announcement came just after hydrogen-electric startup Nikola Corporation’s (NKLA - Free Report) founder and former executive chairman Trevor Milton voluntarily resigned. Nikola is struggling due to the fraud allegations regarding its proprietary technology.  

Nonetheless, this Arizona-based trucking giant is focused on the establishment of hydrogen fueling stations in order to advance hydrogen fuel-cell based transportation. The company is also actively collaborating with industry-leading companies to develop a national hydrogen fueling network. Moreover, Nikola has entered into an alliance with General Motors (GM - Free Report) for engineering and manufacturing Nikola Badger — a fully-electric and hydrogen fuel-cell electric pick-up truck.

Nonetheless, with Toyota gearing up its efforts in the hydrogen vehicle space, we are yet to see which company emerges as the ultimate winner in this race to hydrogen-enabled vehicle supremacy.

Toyota currently carries a Zacks Rank of 3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Notably, shares of the company have declined 6%, year to date, compared with its industry’s fall of 7.8%.

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