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GM to Put 100 Hydrogen-Run Vehicles on the Road in 2007

Firm hopes its fuel-cell SUVs quell criticism that its products use too much gasoline.

September 18, 2006|Jeff Green | Bloomberg News

General Motors Corp., trying to improve its image among environmentalists and motorists looking for better mileage, will build more than 100 hydrogen-fueled vehicles next year for drivers on the West and East coasts.

The sport utility vehicles are powered by fuel cells and emit only water. They are part of GM's plans to have 1,000 hydrogen cars and trucks on U.S. roads by 2010, Vice Chairman Bob Lutz said last week in Dana Point in Orange County, as he showed off a prototype.

GM's initial fleet of 100 will go to customers including government officials and business leaders in Los Angeles, New York and Washington.

"For them to show this much progress is serious," said Bruce Belzowski, assistant research scientist at the University of Michigan Transportation Research Institute in Ann Arbor. "It builds more confidence in the government and the public that these things are viable."

GM is trying to counter criticism that its vehicles use too much gasoline, contributing to environmental problems such as global warming and heightening U.S. dependence on oil from the Middle East.

"We have this undeserved image of being an environmental antichrist," Lutz said.

GM rivals DaimlerChrysler, Toyota Motor Corp. and Honda Motor Co. also are developing fuel-cell vehicles in response to customer and government demands. Buyers are more interested in fuel economy amid the high gasoline prices of the last two years, and new government rules require less pollution and better mileage.

The vehicles aren't yet commercially feasible. Honda has said it costs at least $1 million to build each hydrogen-powered car. There are few hydrogen filling stations in the U.S., limiting the vehicles' range.

GM previously had a fleet of about a dozen fuel-cell models in operation, none driven by retail customers. The hope is that showing off GM's environmental technology in high-profile, coastal markets will attract publicity and help damp some criticism, Lutz said.

The automaker hasn't determined whether it will lease the fuel-cell vehicles, which are based on the Chevrolet Equinox SUV, or use some other arrangement, said Courtney Moody, who manages marketing for the program. The models will arrive in the third quarter of next year, she said.

Fuel cells, which provide onboard power for the U.S. space shuttles, convert hydrogen to electricity in a chemical process that produces only water vapor as a byproduct. The fuel-cell Equinox is designed to run for about 200 miles on a fill-up. The fuel-cell component will last about 50,000 miles, or 2 1/2 years, Lutz said.

Royal Dutch Shell's U.S. unit is working with GM to install as many as 13 hydrogen fueling stations in the three metropolitan areas in the Equinox rollout. GM estimates that it may eventually cost about $12 billion to install enough hydrogen pumps to reach 70% of the U.S. population, said Larry Burns, the automaker's vice president for research and development and strategic planning.

Feedback from users will help GM improve future fuel-cell models as part of a plan that may enable the automaker to have 10,000 such vehicles on the road by 2013 or 2014 and 100,000 by 2015, Burns said.

GM has been a target of critics over its push to sell large SUVs such as the Hummer H1 and H2.

Toyota of Japan, by contrast, has won praise from environmentalists and consumer groups for its Prius sedan, a gasoline-electric hybrid with a U.S. government fuel economy rating of 55 miles per gallon.

GM Chief Executive Rick Wagoner has said the automaker has already spent about $1 billion on fuel-cell development and will spend $1 billion more.

Ultimately, the company wants to be able to build 1 million fuel-cell vehicles a year at the same cost as models with four-cylinder gasoline engines, Lutz said. The U.S. Equinox program will be expanded to Europe and Asia soon, Burns said.

Lutz said that China's government was quite receptive to fuel-cell technology and that the country would probably be a major market for hydrogen vehicles.

No. 1 Japanese automaker Toyota started offering 30-month leases in July for its fuel-cell models to central and local governments in its home market. It also is leasing 12 fuel-cell Highlander SUVs to universities and companies in California.

Honda said last year that it would lower the price of its fuel-cell vehicles to about the same as gasoline-powered cars by 2020. The No. 3 Japanese automaker also plans to start selling or leasing a fuel-cell sports car by 2009.

Honda has 31 hydrogen cars in operation globally. It leases an FCX fuel-cell hatchback to a family in Redondo Beach, the first "sale" to a retail customer. The program provides real-world data from someone using the car daily, Ben Knight, Honda's U.S. executive engineer, said this year.

German-American automaker DaimlerChrysler said this month that it had spent more than $1 billion on its fleet of more than 100 fuel-cell cars, delivery vans and buses.

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