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Daimler and Ford to pursue fuel cell venture
By Bernard Simon in Toronto
Thursday Nov 8 2007 14:2

Daimler and Ford Motor (NYSE:F) have set up a joint venture to pursue development of emission-free fuel cells for cars and trucks as an alternative to petrol engines.

The two carmakers have given the partnership momentum by buying Vancouver-based Ballard Power Systems (NASDAQ:BLDP) ' troubled automotive fuel cell business, including numerous patents and 150 employees.

Vehicles powered by hydrogen fuel cells emit only water vapour through their exhausts. Fuel cells are also far more energy-efficient than internal-combustion engines.

Buyt Casey Selecman, an analyst at CSM Worldwide, an automotive consultancy, cautioned that "there hasn't been a breakthrough technology yet to create the [required] economies of scale".

Daimler and Ford were previously shareholders in Ballard, which pioneered fuel cell development in the 1990s, but has struggled to come up with a commercially viable system for mass production.

It has so far produced only about 130 cars, trucks and buses.

John Sheridan, chief executive, said the sale "lowers Ballard's risk profile by addressing the realities of the high cost and long timeline for automotive fuel cell commercialisation".

A Ford spokesman said that "we can move much more quickly this way".

Daimler will own 50.1 per cent of the venture and Ford 30 per cent. Ballard will hold the remaining shares covered by a purchase or sale option agreement with Ford. Each of the three partners will contribute $60m to the venture.

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Daimler and Ford Like Fuel Cells So Much, They Bought the Company
Date posted: 11-08-2007

VANCOUVER, B.C., Canada — Ballard Power Systems, the Canadian fuel-cell powerhouse, is now under the ownership of Ford and Daimler. The two automakers are forming a private company to be called Automotive Fuel Cell Cooperation, with the intention of coming up with reliable and affordable fuel-cell technology for use in vehicles.

Daimler will hold 50.1 percent of the new company, while Ford will hold 30 percent. Ballard will retain 19.9 percent of the new AFCC company and will focus on non-automotive fuel-cell applications. About 150 people will work for the new company, which will be based in Vancouver with Daimler's executive director of hybrid development, Andreas Truckenbrodt, reportedly coming in to direct the venture.

Herbert Kohler, the Daimler Group's chief environmental officer and vice president of advanced vehicle and powertrain engineering, said AFCC will "go full steam ahead in our preparations for the series production of fuel-cell cars." Kohler said the company will work "intensively" on "the specific requirements we make on fuel cell stacks." Ford's vice president for research and advanced engineering, Gerhard Schmidt, made a similar statement, calling fuel cells "one of the most viable solutions to develop a sustainable, zero-emissions vehicle."

Ford is currently working with prototypes including a hydrogen-powered Focus and a plug-in hybrid Ford Edge. The automaker also sells hybrid versions of the Ford Escape and Mercury Mariner and will begin selling hybrid versions of the Mercury Milan and Ford Fusion in 2008.

What this means to you: Another step closer to zero emissions at the local dealership and in your driveway. — Laura Sky Brown, Correspondent
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