Honda Working With GM To Bring Down Price Of Fuel Cell Cars At Par With Hybrids

Honda Motor said Thursday that it is trying to bring down the cost of its fuel cell cars to the price of hybrids with the help of General Motors. The company said it is working on manufacturing and procuring parts for hydrogen fuel cell stacks under its technology development partnership with GM.

Honda's CEO Takahiro Hachigo made the announcement after the Japanese automaker launched Clarity on Thursday — the company's first mass-market fuel cell vehicle that will run on hydrogen instead of petrol.

The collaboration between the two companies on fuel cell technology, which will create electricity to power an electric motor by using oxygen from the air and compressed hydrogen, began in 2013, Reuters reported. The two automakers are currently studying the joint production and procurement of fuel cell components with the aim of reducing costs so they can be at par with hybrids by 2025, Hachigo said, according to Bloomberg.

Honda also said that its Clarity sedan has the top driving range among zero-emission vehicles at 466 miles as per the standards in Japan and its sales will first be made to local government offices and businesses in Japan before retail customers. The car is priced at 7.66 million yen ($67,000) and its tank could be refilled in three minutes.

Honda plans to sell 200 units of the model in the country in the first year. The starting price for the hybrid cars offered by Honda is 1.69 million yen ($14,895) for the Fit Compact and goes up to 6.8 million yen ($59,933) for the Legend sedan.

Companies like Honda, Toyota Motor and Hyundai Motor have been spearheading the market for fuel cell vehicles in an effort to reduce tailpipe emissions while simultaneously working to offer range and refueling times similar to combustion engines. However, the drawbacks of the vehicles include higher costs and a lack of hydrogen stations, according to Bloomberg.

Toyota’s Mirai, which can also be refueled in three minutes, starts from 7.24 million yen ($63,794) and is eligible to get a tax cut for about 2.3 billion yen ($20,266), Bloomberg reported. Last month, Toyota said it estimated that those who ordered the car on its website could get the delivery of the vehicle by 2019 or later.

Meanwhile, Honda plans to lease Clarity in California by the end of 2016 for less than $500 a month and sell the cars at about $60,000. Deliveries in Europe are also set to begin by the end of 2016, Bloomberg reported. Honda will use the same platform that underpins Clarity for a plug-in hybrid model, which will have an electric-driving range of about 40 miles and is set to hit the U.S. market by 2018.

Hachigo reportedly said that his company is also in talks with GM to extend their collaboration to electric vehicles, artificial intelligence or other technologies.