Ineos and Hyundai strike hydrogen deal

Hyundai and Ineos have struck a deal that could lead to the Korean carmaker buying hydrogen from the chemicals group.

In exchange, Ineos may purchase Hyundai’s fuel cell technology for its audacious entry into the car industry, with its debut vehicle the Grenadier, an off-roader based on the original Land Rover Defender.

The shift away from petrol engines to batteries and hydrogen power is forcing carmakers to set up new supply chains. Volkswagen and BMW, for example, have signed deals to secure lithium directly for their own batteries.

For carmakers planning to roll out hydrogen models, including Hyundai, Toyota and General Motors, securing a supply of the fuel for their models is key to generating interest in the nascent technology.

Hyundai already has several hydrogen cars on the market, including the Nexo sport utility vehicle, although sales have been tiny because of the cost of the technology and a lack of refuelling stations. The company wants to produce 700,000 hydrogen fuel cell units by 2030.

Installing hydrogen stations is more expensive than battery charging points, because of the need to keep the fuel at the right conditions, while producing it through a carbon-intensive process, which also undermines its green credentials.

Ineos, run by billionaire tycoon Jim Ratcliffe, is Europe’s largest existing operator of electrolysis, which uses renewable energy to produce hydrogen for power generation, industry and transport.

The group also produces 300,000 tonnes of hydrogen annually as a waste product from its chemicals operations.

Under the memorandum of understanding signed on Monday, Ineos and Hyundai will “jointly investigate opportunities for the production and supply of hydrogen as well as the worldwide deployment of hydrogen applications and technologies”.

Carmakers wanting to make hydrogen cars “have only achieved half the goal unless you have the ability to fill it up and are able to make it affordable”, said Mark Tennant, commercial director at Ineos’s automotive division.

Sae Hoon Kim, head of fuel cells at Hyundai, said: “Ineos’s move into the development of a fuel cell electric vehicle and hydrogen ecosystem marks yet another milestone towards sustainable and clean transportation.”

He added: “We also hope our decades-long expertise in hydrogen fuel cell work in synergy with Ineos’s expertise in the field of chemistry to realise the mass production of green hydrogen and fuel cells for the Grenadier.”

The Grenadier is expected to be built at a former Mercedes plant in France, having earlier been slated for production in the UK. French unions ratified the sale of the site from Daimler earlier this month, paving the way for Ineos to take control of the facility.

Production of the vehicle is expected to begin at the end of next year, with the first sales in 2022.

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