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INDUSTRY & TRADE

Germany bets on hydrogen to help cut trucking emissions

German firms such as Daimler Truck and Bosch are betting that hydrogen has a role to play in slashing road transport emissions. But the technology has plenty of hurdles to overcome before going mainstream.

Andreas Gorbach, member of the Board of Management of Daimler Truck holding AG poses in front of an Hydrogen prototype GenH2 truck of the Daimler Truck Holding AG in Berlin, on September 26, 2023.
Andreas Gorbach, member of the Board of Management of Daimler Truck holding AG poses in front of an Hydrogen prototype GenH2 truck of the Daimler Truck Holding AG in Berlin, on September 26, 2023. (Photo by John MACDOUGALL / AFP)

Applause rings out as Daimler Truck’s hydrogen-powered, zero-emission lorry crosses the finish line in Berlin after completing a record-breaking 1,047-kilometre (650 mile) journey on a single tank.

But in the race to decarbonise long-haul trucking, the niche technology is still stuck in the slow lane.

The Mercedes-Benz GenH2 truck started its demonstration run at the group’s factory in Woerth am Rhein on Monday afternoon, near the border with France, and arrived in the German capital on Tuesday morning.

The prototype truck made the trip fully loaded on only one fill of liquid hydrogen, similar to what a diesel-powered truck can do.

Unlike planet-warming diesel however, the hydrogen fuel cell technology used in the truck emits only water vapour.

“You’re showing that a heavy load can be transported over a long distance in a sustainable manner,” Petra Dick-Walther, state secretary for economic affairs in Germany’s Rhineland-Palatinate region, said at the departure ceremony.

Germany’s Daimler Truck, one of the world’s biggest truckmakers, said the feat of cracking the 1000-kilometre range marked “another milestone” for hydrogen-powered driving.

But the technology has plenty of hurdles to overcome before going mainstream.

READ ALSO: Germany’s Volkswagen considers job cuts as electric car shift stalls

Hydrogen fuel is produced through water electrolysis but is only considered “green” if the electricity required for the process is obtained from renewables such as wind or solar power.

Hydrogen produced using coal or natural gas is more widely available but less environmentally friendly.

Technical challenges, high costs and a lack of infrastructure have all slowed the advance of clean hydrogen.

German firms such as Daimler Truck and engineering giant Bosch are nevertheless betting that hydrogen has a role to play in slashing road transport emissions, alongside battery-powered electric vehicles.

“To decarbonise transport, we need both,” said Andreas Gorbach, head of technology at Daimler Truck who drove the GenH2 across the finish line himself.

The “sweet spot” for hydrogen trucks lies in particularly demanding long-distance haulage, he said, whereas battery-electric trucks do well on plannable routes with plenty of charging options.

Daimler Truck is aiming for series production of hydrogen trucks in “the second half of the decade”, Gorbach added.

But he said the hydrogen breakthrough will depend on two major factors: the rollout of refuelling stations, and “the availability of green energy at a competitive cost”.

Lagging behind

Under current European Union rules, truckmakers have to cut emissions of new trucks by 30 percent by 2030 compared with 2019 levels.

But European Commission said earlier this year it was eying tougher cuts of 45 percent by 2030 and 90 percent by 2040.

On top of the regulatory pressures, truck manufacturers face growing international competition as the battle to supply zero-emissions trucks heats up.

According to a recent study commissioned by campaign group Transport and Environment (T&E), European truckmakers “could lose 11 percent of the EU market to international electric rivals by 2035” if they don’t go green faster, with the likes of Tesla and China’s BYD snapping at their heels.

American company Nikola, a Bosch customer, has already begun mass production of its hydrogen-powered heavy-duty truck in the United States, benefiting from climate subsidies under President Joe Biden’s Inflation Reduction Act.

In August, Nikola reported a total of 202 orders from 18 customers.

To share out the costs of a hydrogen rollout, Daimler Truck has partnerships with other truckmakers and energy companies such as Shell, Total and BP to install refuelling stations in Europe and the United States.

Bringing down the price tag of expensive hydrogen will be key to its success.

Rainer Mueller-Finkeldei, head of Mercedes-Benz Trucks product development, estimates that the infrastructure will be in place by 2030 and that the total cost of buying and operating hydrogen trucks will eventually be “similar” to diesel trucks.

But according to the campaign group T&E, it could take until 2040 for hydrogen trucks to reach cost parity with diesel.

Both will be more expensive than battery electric trucks by then, its calculations showed.

By Léa PERNELLE

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INDUSTRY & TRADE

‘It’s all the same to me’: Why German auto workers are learning to install heat pumps

Emrullah Karaca has made brakes for the past 20 years, but he is now learning to assemble heat pumps instead, as the Continental factory where he works in northern Germany is slated to close.

'It's all the same to me': Why German auto workers are learning to install heat pumps

Production of the car component at the town of Gifhorn will end in 2027 and move to Croatia, the Czech Republic and Wales to keep the costs “competitive”, according to Continental, which will cut about 7,000 jobs worldwide.

The relocation means a new career for 49-year-old Karaca, one of a rising number of workers in companies supplying Germany’s vital automotive sector who are being hit by a tsunami of redundancies.

Facing up to the double shock of the end of combustion engines and rising competition from China, European suppliers like Bosch, ZF and Webasto have all announced cuts — which have piled up to the point where the issue has cast a shadow on the forthcoming EU elections.

Brussels has promised to do more to boost the domestic car industry and tackle unfair competition from cheaper Asian rivals.

But EU plans to outlaw the sale of new fossil fuel-powered cars from 2035, meaning some jobs will inevitably become redundant.

Battery transition

The upcoming closure to the Continental plant in Gifhorn has been the catalyst for Karaca and the other 800 employees working there to start retraining in another area.

A local heating systems company, Stiebel Eltron, has proposed to take over the site and retain some employees for future production.

“Brakes or heat pumps, it’s all the same to me,” said Karaca, whose two parents both worked for Continental at the factory.

Making exhausts, headlights, gear boxes or brakes has long been a steady job with suppliers in Germany alone employing some 270,000 people.

But the technologies they have specialised in are obsolescent and the process of making battery cars is a less labour-intensive undertaking.

“If today you need 100 people to produce a normal motor, then with the electric motor you only need 10,” said Jutta Rump, a business professor at Ludwigshafen University.

In Gifhorn, Stiebel Eltron is offering the prospect of further employment to some 300 of Continental’s workforce.

Another 100 could find a home at a nearby Siemens mobility plant that supplies rail companies.

Poor prospects

What jobs remain are under increasing pressure from Chinese competitors, who are hauling in a growing share of the market.

The Chinese battery-maker CATL has grown in short order to become the world’s third largest auto supplier, in a sector still led by Bosch, according to consultancy Roland Berger.

In Germany, one in three companies in the sector is planning to move part of its production abroad in the coming years to cut costs, according to a study by the German carmakers association VDA.

The axe has already fallen on 3,400 workers at Ford’s factory in Saarlouis, in the west of Germany.

The plant closure takes with it a whole network of local suppliers, whose workers staged a six-day strike in March to get better redundancy terms.

Among them, 33-year-old Luca Thonet, employed by Ford supplier Lear, said he would like to stay in the region, close to the French border.

“But there is almost no industry left in the region, and the other factories are not in a very good situation either,” he told AFP.

Thonet cited the situation at ZF, the second-largest German auto supplier, which announced the closure of two sites in its domestic market.

The ZF works council fears some 12,000 job cuts could be in the pipeline, with a number falling in the same region as Saarlouis.

Germany may be facing a shortage of workers, but not all sectors are equally impacted.

In IT, product development, or sales “there’s a lack of qualified personnel”, said expert Rump. “That’s not the case in production.”

By Lea PERNELLE

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