China’s Grove startup could grow up to be the BYD of fuel-cell cars

Grove’s coupe car on display in Shanghai.
Grove’s coupe car on display in Shanghai.
Image: Grove
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China’s next big thing in electric vehicles could be fuel-cell cars—and the Shanghai Auto Show offered clues to one Chinese firm that might become a symbol of the industry.

Grove Hydrogen Automotive, a fuel-cell vehicle startup that began as a state-backed research institute project (link in Chinese) in 2015, made its debut at the Shanghai show with prototypes of three fuel-cell passenger cars: a coupe and two SUVs. Just ahead of the show, it announced plans to supply 200 units of a fourth fuel-cell model for rental in the southwestern city of Chongqing and in its headquarters city of Wuhan by the end of 2019 (link in Chinese).

Beginning in 2020, the company plans to put 10,000 fuel-cell vehicles on the roads for sharing.

A decade ago, state support, including subsidies for buyers and manufacturers, ended up creating some of the world’s biggest battery vehicle players in China—most notably BYD, a private mobile phone battery maker that is now the world’s top seller of EVs (paywall). Similar growth could be ahead for this brand-new startup, which only registered as a company last year, as China signals it wants to speed up the development of a market for fuel-cell vehicles, or FCVs, much as it did for battery-powered EVs.

In December, the architect of China’s EV industry, Wan Gang, wrote an op-ed for state-run newspaper People’s Daily about the potential for using FCVs more widely, particularly in public transport. The government’s annual report, released in March, for the first time mentioned hydrogen development (video, link in Chinese). This week, on the sidelines of the Shanghai Auto Show, Wan, China’s former technology minister, again talked up the idea of using FCVs for ride-sharing, and long-distance transport.

FCVs are zero-emission, provide a longer range, and require less time to refuel, which could address the range anxiety around using battery electric and plug-in hybrids. But the challenges of transporting hydrogen, and the high cost of putting in refueling stations—compared with charging stations for battery cars, which can be added anywhere there’s electricity—have created obstacles for FCVs. China has sold only 2,000 FCVs as of 2018, according to Wan.

For comparison, 1.25 million new energy vehicles, including battery electric vehicles and plug-in hybrids, were sold in 2018 alone in China. (And even those are drop in the bucket of the 28 million vehicles China purchased last year.)

Hao Yiguo, president of Grove, told a Chinese automotive blog on April 18 that the availability of refueling stations (link in Chinese) won’t be an issue by the time Grove’s cars are on the road.

The government, and some state-run firms, have recently said they’re making the building of hydrogen fuel stations a priority. Shanghai, for example, expects to have 50 hydrogen refueling stations by 2025.

Grove plans to deliver its first FCVs to individual consumers in the last quarter next year.  They’ll be about as expensive (link in Chinese) as the higher-end Tesla Model X is in China—the starting price of the SUV will be 750,000 yuan ($112,000), a company representative said.