Toyota has announced plans to set up a Beijing-based joint venture with five Chinese companies, aiming to develop hydrogen fuel cells for commercial vehicles, and diversify its China-focused investments that already involve electric cars and self-driving technology.
With an initial investment of 5 billion yen ($46 million), the joint venture, named United Fuel Cell System R&D (Beijing) Co., Ltd., will be officially established by the end of 2020, with Toyota holding a 65% stake, the Japanese automaker said in a statement Friday.
The five Chinese companies are Beijing SinoHytec, FAW, Dongfeng Motor, Guangzhou Automobile Group and Beijing Automotive Group, the statement revealed.
It was announced that Beijing SinoHytec, which produces hydrogen fuel cell engines and is set to float shares on Shanghai’s Nasdaq-style high-tech Star Market, will control 15% of the joint venture, while the other four will take a 5% stake each.
Hydrogen fuel cell vehicles are widely seen as one of the most eco-friendly cars as they run on electricity generated from a chemical reaction of compressed hydrogen and oxygen and emit only water. Still, the vehicles do have some shortcomings, cruising for shorter distances and needing a longer charge than pure electric vehicles.
In recent years, China has promoted the use of hydrogen fuel cell technology, describing it as a key new-energy technology to replace traditional petroleum-based engines.
In April, the Chinese government set out a target of building industrial chains for hydrogen energy generation and hydrogen fuel cell vehicles within four years.
Last year, China shifted 2,737 units of hydrogen fuel cell vehicles, many of which were public buses and commercial vehicles used for logistics, according to statistics from the China Association of Automobile Manufacturers.