OPINION
42 // July 2019 // www.electrichybridvehicletechnology.com
OEM business models need to cha nge in order to
suc cessfu lly implement hyd r ogen fuel cell vehicle s
Hugo Spowers
Hydrogen vehicles can be commercially viable, here
and now, but in order to realize this we do need to
build cars di erently and supply them under a di erent
business model.
There is no product on the planet remotely as good value
for money as a modern motor car, with all its complexity and
refinement, but it has been refined around combustion
engines. The characteristics of fuel cells are very di erent
and, if we want to insert hydrogen into that platform, we
have to persuade fuel cells to behave like petrol engines,
which they don’t do very well. The only way to introduce
them incrementally is to push new technologies beyond
current state of the art through basic science; this requires
a lot of time and money, and a large team.
The alternative is to focus on the system level, the patterns
of relationship between everything in the car, and system
level innovation can be done quickly and cheaply by
small teams.
I like to compare this to Cooper in the 1950s. The UK was
nowhere in motorsport in those days. Ferrari was dominant
and had hundreds of people producing beautiful engines.
But in 1959, five men in a shed in
the London suburb of Kingstonupon
Thames built the Cooper,
turned up at Monaco and Jack
Brabham won. They won eight out
of nine Grand Prix that season,
demolishing Ferrari with an engine
bought o -the-shelf that anyone
else could buy. But they made a
di erent sort of car, putting the
engine in the back rather than in
the front among other
There is no product on
the planet remotely as
good value for money
as a modern motor car
things – the breakthrough was at the system
level rather than through sub-system
components. Lotus came along and
between them they built the foundation of
what’s become the modern motorsport
industry in the UK but the amazing thing
about this is that neither company ever
built an engine.
A similar argument applies to the
business model that we have used for the
last hundred years. Existing manufacturers
not only have to shoe-horn hydrogen into the
sort of cars they manufacture but
also make them in the
manufacturing capacity
they have already got, distribute them in the distribution
system they have, within a company culture that is very
highly refined around combustion engines; the real barriers
to bringing hydrogen cars to market are not technical, but to
do with people, politics and business inertia.
Business models are forged by the constraints in the
business environment in which we operate. The principal
constraints that we all face today – climate change, peak
resource issues and energy security – were simply not on
the radar 100 years ago, and it is much easier to design a
business model for the 21st century than try to tweak a
model that was designed to do
something fundamentally di erent.
If you sell cars, you make more
money by selling more cars, so the
financial driver is to maximise
resource consumption, and I don’t
see how we can ever have a
sustainable industrial society
based on rewarding industry for
the opposite of what we’re trying
to achieve.
It’s also not very smart business
because it’s betting your future profits against inevitable
resource depletion and price shocks.
If on the other hand, cars are supplied as subscription
service, comprising a fixed monthly charge and a mileage
rate that covers all costs, including insurance and fuel,
the car becomes a revenue-generating asset on the
balance sheet of the manufacturer, who sells mileage
rather than cars. The manufacturer is rewarded for
longevity, low running costs and e iciency, cars are
designed for maximum recovery of value and scarce
resources are capitalized, decoupling revenue from
virgin resource consumption.
Oxford and Cranfi eld graduate, Hugo Spowers, is an
automotive engineer and entrepreneur who left the world
of racing car design in the search of more sustainable
alternatives to vehicle effi ciency. As a result, he developed
the Morgan LIFECar and the Hyurban demonstrator on his
way to the RASA, which is already on public roads.
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