Honda expects to sell fuel-cell car in 4 years

VANCOUVER — Honda would like to be the first to market a fuel-cell car to the public, but it's less important than delivering something that's recognizably Honda, says a U.S. executive overseeing the project.

"I don't think it's critical to be first," says Steve Ellis, manager of fuel-cell marketing for American Honda Motor Co.

"But maybe it's more important than what is first is done with extremely high quality and (with) products that leave a positive lasting impression on the customer."

Regardless of who's first, fuel-cell cars will make up only a fraction of the auto market for two or more decades, says Ellis. And automakers likely won't sell them profitably for some time.

Honda unveiled its FCX hydrogen-fuel cell concept car at the North American International Auto Show in Detroit last January and announced it would produce a model based on the show car within three or four years.

It's in a race with other major automakers to bring the zero-emission technology to dealer showrooms.

Honda, like its competitors, has a small fleet of early-generation FCX cars mostly in the hands of fleet customers to test the technology over a long term.

Some 15 of the tall, boxy hatchbacks are trundling around California and New York and another dozen are in Asia.

It brought a handful of the cars to Vancouver for this week's Globe 2006 environmental business conference.

Fuel cells produce electricity by chemically breaking down hydrogen. When pure hydrogen is used, the only byproducts are heat and water, although some pollution is produced if fuels such as gasoline are used to make the hydrogen.

Honda was an early licensee of fuel-cell stack technology developed by Vancouver-based Ballard Power Systems.

But eventually, like Toyota and General Motors, Honda struck out on its own, though Ellis says some Ballard-based Hondas are still operating.

Fuel-cell stacks are the heart of a fuel-cell car, says Ellis, and engine development is at the core of Honda's self-image, so going it alone was a logical choice.

Honda has a rough idea of who its first fuel-cell customers will be — people trading in their gasoline-electric hybrid cars.

"We already hear of people saying, `gee I like my hybrid but what's next. I want to go beyond gasoline," says Ellis.

Honda believes the fuel cells actually will be an easier step for drivers of the compressed natural gas cars it sells in the United States.

"They already have experience with limited infrastructure, with high-pressure gaseous storage on board. They're comfortable with it. They've crossed that hurdle. Hybrid drivers haven't done that yet," says Ellis.

Honda's tiny fleet of FCXs are running on heavily subsidized leases. Ellis expects the same will be true of the next generation car.

No one expects it to be profitable — hybrids are just turning the corner almost a decade after being introduced.

Automakers expect fuel-cell vehicles to co-exist with hybrids, compressed natural gas and conventionally powered autos for decades.

The adoption of fuel cells depends on the cost of the technology coming down and the future price of oil, Ellis says.

Infrastructure — refuelling stations — is also critical. California and British Columbia have committed to the so-called hydrogen highway, but the pace of development depends on support from the government and the energy sector.

"Canadian infrastructure isn't where it needs to be," says Sandy Di Felice, Honda Canada's assistant vice-president of corporate communications.

"Will that be an impediment to future growth? No."

Honda is working with affiliate companies to develop a home-refuelling station that, when tied to a house's natural-gas service, can also produce electricity for the home.

It's also working on a solar-powered hydrogen station that will produce the gas from water through electrolysis — cutting the last tie to fossil fuels.