Automotive Fuel Cell Market Expected to Reach $12.6 Billion by 2033

According to a new report published by Allied Market Research, titled, “Automotive Fuel Cell Market, by Vehicle Type (Passenger Vehicles, Light Commercial Vehicles (LCVs), Buses, Trucks, Off-road Vehicles), Power Rating (Less Than 150kW, 150 To 250kW, Greater Than 250kW), Component (Fuel Processor, Power Conditioners, Fuel Cell Stack, Air Compressors, Humidifiers), Fuel Cell Type (Polymer Electrolyte Membrane Fuel Cells, Direct Methanol Fuel Cells, Hydrogen, Ethanol), Propulsion (FCEV, FCHEV) Global Opportunity Analysis and Industry Forecast, 2024-2033." The automotive fuel cell market size was valued at $297.84 million in 2023, and is estimated to reach $12.6 billion by 2033, growing at a CAGR of 45.7% from 2024 to 2033.

Automotive fuel cell industry function similar to batteries but offer the advantage of continuous operation without the need for recharging, as long as fuel is supplied. A fuel cell is composed of two electrodes, a negative electrode (anode) and a positive electrode (cathode) separated by an electrolyte. Hydrogen fuel is supplied to the anode, while oxygen (from the air) is fed to the cathode.

In a polymer electrolyte membrane (PEM) fuel cell, a catalyst at the anode splits hydrogen molecules into protons and electrons. The electrons travel through an external circuit, generating an electric current, while the protons pass through the electrolyte to the cathode. At the cathode, protons, electrons, and oxygen combine to form water and release heat. This process continuously produces electricity, as long as fuel and oxygen are available, making fuel cells a sustainable energy source.

Furthermore, a fuel cell, which is actually a collection of cells, shares similar components with a battery. Each cell in a fuel cell system contains a pair of electrodes: the anode, which releases electrons, and the cathode, which absorbs them. These electrodes are immersed in and separated by an electrolyte, which can be either a liquid or a solid. The electrolyte must conduct ions between the electrodes to complete the system's chemical processes. At the anode, a fuel like hydrogen is oxidized, generating hydrogen ions and electrons. An oxidizer, such as oxygen, is supplied to the cathode, where the hydrogen ions from the anode combine with the oxygen and electrons to form water.

The difference in energy levels between the electrodes, known as electromotive force, determines the voltage per cell. The amount of electric current generated depends on the chemical activity and quantity of fuel supplied. Unlike a conventional battery, the electrodes and electrolyte in a fuel cell are designed to remain unchanged by the chemical reactions, allowing the process to continue as long as reactants are available.

In addition, a fuel cell that is practical is a complicated system. Pumps and blowers, fuel-storage containers, features to increase fuel activity, and an array of advanced sensors and controllers to monitor and modify system performance are all necessary. The fuel cell's performance might be constrained by the lifespan and operational capability of each of these system design elements.

Furthermore, major market players have undertaken various strategies to increase the competition and offer enhanced services to their customers. For instance, in November 2023, Ballard Power Systems received orders for 62 hydrogen fuel cell engines from Solaris Bus & Coach sp. z o.o., a prominent European bus manufacturer. These engines will be used to power hydrogen-powered city buses in Germany and Poland, with the majority of deliveries expected in 2024. This order brings the total number of engines ordered by Solaris this year to nearly 350, showcasing significant growth from the more than 140 fuel cell city buses Solaris has previously deployed across Europe. This development highlights the increasing adoption of hydrogen fuel cell technology in public transportation across the continent, reflecting a broader commitment to sustainable and zero-emission transit solutions.

Furthermore, in December 2023, Plug Power Inc. installed and commissioned a one-megawatt proton exchange membrane electrolyzer at an Amazon fulfillment center in Aurora, Colorado, marking Amazon's first such installation. This electrolyzer produces low-carbon hydrogen, fueling over 225 hydrogen fuel cell-powered forklifts at the site, and has the capacity to support up to 400 forklifts. The produced hydrogen is compressed and stored on-site in a gaseous hydrogen storage tank for use by the forklifts turcks.

On the basis of fuel cell type, the polymer electrolyte membrane fuel cell segment attained the highest market share in 2023 in the automotive fuel cell market growth. Due to its high power density, quick start-up capabilities, and efficiency at lower temperatures. These advantages make PEM fuel cells ideal for a wide range of automotive applications, thus driving their dominant market share. PEMFCs offer rapid start-up times and operate effectively at low temperatures, making them ideal for passenger vehicles. Their proven performance and growth in adoption in the automotive industry drive their dominance in the market.

Meanwhile, the ethanol segment is projected to be the fastest-growing segment during the forecast period due to its potential for providing a more sustainable and widely available alternative to hydrogen. Ethanol fuel cells offer advantages such as easier storage and distribution compared to hydrogen the integration of ethanol into fuel cell technology benefits from existing infrastructure and supply chains, accelerating its adoption and automotive fuel cell market opportunity.

On the basis of fuel cell type, the polymer electrolyte membrane fuel cell segment attained the highest market share in 2023 in the automotive fuel cell market analysis. Due to its high power density, quick start-up capabilities, and efficiency at lower temperatures. These advantages make PEM fuel cells ideal for a wide range of automotive applications, thus driving their dominant market share. PEMFCs offer rapid start-up times and operate effectively at low temperatures, making them ideal for passenger vehicles. Their proven performance and growth in adoption in the automotive industry drive their dominance in the market.

Meanwhile, the ethanol segment is projected to be the fastest-growing segment during the forecast period due to its potential for providing a more sustainable and widely available alternative to hydrogen. Ethanol fuel cells offer advantages such as easier storage and distribution compared to hydrogen the integration of ethanol into fuel cell technology benefits from existing infrastructure and supply chains, accelerating its adoption and market growth.

On the basis of region, North America attained the highest market share in 2023 and emerged as the leading region in the automotive fuel cell market size. This dominance is driven by substantial investments in hydrogen infrastructure, strong government support through incentives and regulations, and the presence of major automotive companies advancing fuel cell technology. These factors collectively fostered rapid growth in the region's fuel cell vehicle adoption.

On the other hand, Asia-Pacific is projected to be the fastest-growing region for the automotive fuel cell market during the forecast period. This growth is attributed to rise in government support, substantial investments in hydrogen infrastructure, and growth in demand for clean energy solutions. Countries such as Japan, South Korea, and China are leading the charge, fostering rapid market expansion.

The study provides Porter’s five forces analysis to understand the impact of several factors, such as bargaining power of suppliers, competitive intensity of competitors, threat of new entrants, threat of substitutes, and bargaining power of buyers, on the automotive fuel cell market share.

The Impact of the Russia-Ukraine War

The Ukraine-Russia war has significantly impacted the automotive fuel cell industry by disrupting global supply chains for critical materials and components, such as platinum and rare earth metals, which are essential for fuel cell production. Increased geopolitical instability has also led to soaring energy costs and heightened raw material prices, affecting production costs. In addition, the conflict has shifted investment priorities and resources away from clean energy projects in affected regions. Conversely, the war has accelerated efforts in alternative regions to strengthen hydrogen infrastructure and diversify supply chains, potentially fostering innovation and market resilience in the long term.

Key Findings of the Study

• On the basis of vehicle type, the passenger vehicles segment held the largest share in the automotive fuel cell  in 2023.
• By Power Rating, the greater than 250kW estimated to be the largest segment for the automotive fuel cell market forecast in 2023.
• On the basis of component, the fuel cell stack segment held the largest market share in 2023.
• On the basis of fuel cell type polymer electrolyte membrane fuel cell segment held the largest market share in 2023.
• On the basis of propulsion, the FCEV segment held the largest market share in 2023.
• On the basis of region, North America held the largest market share in 2023.

Key players operating in the global automotive fuel cell  include Ballard Power Systems, Plug Power Inc., Hyundai Motor Company, Nuvera Fuel Cells, LLC, PowerCell Sweden AB, Horizon Fuel Cell Technologies Pte Ltd, Nedstack Fuel Cell Technology, ElringKlinger AG, Toyota Motor Corporation, and Intelligent Energy Limited. They have adopted strategies such as contracts, agreements, acquisition, product launch, and others to improve their market positioning.