One other Day, One other Hydrogen Transportation Failure, This Time Quantron & IKEA

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A yr in the past, whereas assessing numerous organizations that had reached the terminus of the Odyssey of the Hydrogen Fleet six act tragicomedy, I identified the terrible, horrible, very unhealthy, no-good resolution the Austrian department of IKEA had made to purchase Quantron hydrogen step van supply vans. Since then, I’ve been giving strategic steering out freely — and seemingly handled as value each penny — to transportation car producers like New Flyer to ditch their hydrogen traces and focus solely on battery electrical.

The explanations are easy. Each hydrogen car a agency sells possible causes them to not promote three battery electrical autos. That’s as a result of hydrogen shopping for companies inevitably find yourself actually sad with them. The hydrogen could be very costly and remaining that manner. The hydrogen is high-carbon emissions and isn’t altering. The hydrogen refueling stations don’t work reliably in any respect, out of service way more hours than they’re pumping the fuel. The autos themselves price about 50% extra to keep up than battery electrical ones.

Sad prospects are prospects who will decide a special agency to purchase from subsequent time.

Additional, making an attempt to do advanced and costly hydrogen autos and battery electrical makes the producer lose give attention to making the perfect battery electrical autos attainable. They cut up capital and useful resource investments over the loser — hydrogen — and the winner — battery electrical — as a substitute of simply spending it on the one. Hydrogen buses price much more to fabricate and repair than battery electrical and at all times will, as a result of battery electrical are a lot easier. That implies that any agency promoting hydrogen buses can have much more individuals dedicated to them than battery electrical as a ratio of autos delivered. A agency that has hydrogen autos in its steady can have dearer battery electrical autos because of this, because the battery division shall be consuming a few of the hydrogen overhead.

It additionally implies that they’re promoting inferior electrical autos into markets the place Chinese language companies are very aggressive, even with tariffs. For bus manufacturing companies like New Flyer in North America and Solaris in Europe, they need to be ceding the useless finish hydrogen market to rivals who wish to go stomach up as an intentional technique, in order that they will maintain market share away from BYD and Yutong, who’re actively promoting. BYD is selecting up orders for a whole lot of electrical buses at a time in North America, and the 2 companies between them delivered extra battery electrical buses than Solaris’ complete supply quantity for 2023.

And, in fact, their gross sales individuals will take a look at the larger sticker value per unit for hydrogen autos and be incentivized to promote extra of them as a substitute of low cost battery electrical autos. That is one other strategic blunder and can trigger a lack of extra battery electrical gross sales. They are going to be proposing as many hydrogen autos as attainable in each tender with the hope of larger bonuses, as a substitute of maximizing battery electrical car gross sales.

The results of that is that any transportation producer promoting hydrogen buses at the moment will lose market share yearly to BYD, Yutong, different Chinese language pure performs and companies which do joint ventures with Chinese language companies to place a Western shell and model on a Chinese language battery electrical drivetrain. It’s extremely quick sighted and unhealthy technique.

Producers with hydrogen and battery electrical choices are deliberately creating the situations for their very own decline in market share and even chapter.

And so, to Quantron. Once I wrote about IKEA’s terribly unhealthy option to pursue silly Austrian governmental subsidies for hydrogen refueling and supply vans, Quantron’s electrical equivalents solely had 200 kilometer ranges. That’s for the standard step van. IKEA had purchased a bunch of those inferior step vans from Quantron, and so they weren’t enough for the minority of longer vary deliveries.

As an alternative of taking a look at distributors who have been delivering larger high quality electrical vans, IKEA saved shopping for from Quantron, selecting the hydrogen model of their step van, with a 400 kilometer vary. In the meantime Mercedes eSprinter is obtainable for €60,000 and has a 400 km vary.

What was IKEA paying for Quantron hydrogen vans? Virtually one million euros per van, as a result of they have been additionally shopping for hydrogen refueling functionality. It made completely zero sense, however these Quantron gross sales individuals have been extremely motivated to promote as a result of they’d get larger bonuses. Even shopping for Quantron battery electrical step vans made no sense as Mercedes’ product was about €8,000 euros cheaper, so the native IKEA govt clearly was not notably good at procurement.

All of that is enjoying out precisely as anticipated. Quantron filed for chapter on October thirtieth, 2024. Meaning the 90 workers of the agency — word the small quantity making an attempt to assist each the a lot easier battery electrical drive practice and the way more advanced hydrogen one — are out of labor, and certain the 350 within the Quantron ecosystem are at risk of dropping their jobs except their companies can discover them extra gainful employment on one thing that truly is sensible.

What does this imply for IKEA? Effectively, the 5 Quantron gasoline cell autos they obtained final yr are stranded now, with none group to service them or purchase components from. The 40 further hydrogen vans that they had on order from Quantron have dissolved right into a puff of water vapor, so their plan for fleet decarbonization, regardless of how boneheaded, is upended as effectively. And the 56 battery electrical vans with 200 km ranges which they purchased from Quantron are stranded too, so their complete supply fleet is now a upkeep nightmare with no residual resale worth. No less than the electrical vans are simple to keep up and pretty dependable.

I’m certain the producers who make hydrogen step vans in Europe — Stellantis, Hyvia and VDL — shall be lining as much as attempt to take the IKEA hydrogen gasoline cell step van orders for themselves, as a substitute of taking a look at Quantron and realizing that it’s an abject lesson in why their methods are damaged.

What ought to IKEA Austria do? It ought to rethink its technique. It ought to acknowledge that battery electrical step vans are utterly match for function, so long as they don’t limit themselves to producers with inferior ones. They need to write off the 5 hydrogen vans they’ve in addition to the hydrogen refueling station.

They need to recast their fleet decarbonization technique as utterly battery electrical, and begin ordering battery electrical step vans from Mercedes or BYD. They need to run their Quantron battery electrical vans till they fall over after which discover second lives for his or her batteries and scrap the remaining. They might want to do a whole depreciation of all of their battery electrical and hydrogen fleet this yr, in fact.

They need to most likely rethink the employment of whoever made and bought the terrible, horrible, very unhealthy, no-good resolution to purchase all the pieces from Quantron after which make it worse by shopping for hydrogen vans as effectively. They clearly have very restricted analytical or strategic expertise, coupled with too good gross sales expertise. That’s a harmful mixture.