First Hydrogen Delivers With Amazon
First Hydrogen has put out news about their testing of commercial vehicles with Amazon in Europe. They are showing that their commercial hydrogen vehicles used for parcel delivery are getting the attention of companies such as Amazon, plus learning crucial details about how they perform.
I’m a very big fan of electric vehicles and think they will keep growing at a rapid pace. But, in between higher global market share, there will be a long term transition period.
First Hydrogen’s business plan makes a lot of sense to me. At this point, they are not interested in moving into passenger vehicles, nor the long-haul truck business. They want to focus on commercial vehicles in between those two such as delivery vehicles like the ones they have been testing with Amazon and others.
This is a huge worldwide market ripe for disruption. Electric vehicles are challenged in this segment due to cost, cargo space, heavy use, slow charging time and access to the Electricity grid to recharge the number of vehicles at the same time if you are a fleet owner or operator. So, they continue to be dominated by internal combustion vehicles.
Hydrogen vehicles have the potential for disruption in this segment. Amazon understands this which is why I was impressed to see that First Hydrogen ran tests with them.
The collaborative work with Amazon gives them fantastic real world data to enhance their vehicles. Next is the news release that can help you understand what they accomplished.
Vancouver, British Columbia--(Newsfile Corp. - June 7, 2024) - First Hydrogen Corp. (TSXV: FHYD) (OTC: FHYDF) (FSE: FIT) ("FIRST HYDROGEN" or the "Company") is pleased to announce the company has reached a milestone as its hydrogen-powered-fuel-cell vehicle (FCEV) has completed a successful trial with Amazon (see news release May 6, 2024). The trial took place in London, UK, with the FCEV accumulating 535 km (332 miles), delivering 3,462 packages with 1,547 stops. Amazon confirmed the FCEV performed well during the trial; the FCEV was used in 8-10 hour shifts that included frequent stops. As a result of trials to date, improvements in design and predictive behaviour (AI) will be implemented to maximize payload and performance. Building on the success of the real-world trials and showcasing our hydrogen-as-a-service model (HASS), through partnerships, the Company will expand its trials to Europe and North America.
Telematics data was downloaded and analyzed daily by Amazon's Data Science team to evaluate FCEV performance in various conditions. The delivery cycle with frequent start-stops and the influence of driver behaviour on energy efficiency and recovery provides data analysts with real-world metrics. Based on data, the projected range of the Company's FCEV under these conditions is 397 km (247 miles). First Hydrogen's engineers believe the range can be improved to greater than 450 km (280 miles) with further improvements before needing to refuel.
The human influence (driver) provided essential factors to the data, as drivers run over curbs, shift to Park before the vehicle comes to a full stop, do not slow down when driving over speed bumps, potholes or bumpy roads and some drive aggressively. The data recorded during the trial provided both First Hydrogen and Amazon engineers analytics to compare hydrogen-powered fuel cells versus battery electric vehicles and internal combustion engine vehicles. First Hydrogen engineers are able to use the data to implement additional developments:
Predictive software
Used to manage energy to optimize power split and system efficiency, analyze customer drive cycles to provide best routes. The Company's AI algorithm will incorporate data such as delivery stops, traffic information, weather conditions and drivers to improve vehicle efficiency and predefine delivery routes.
Pedal controller tuning
During short and dynamic drop-off drives, driving style plays a role in the overall hydrogen consumption. The FCV driving program can be set to different settings to optimize efficiency for highway, city driving, parcel delivery, etc. The FCEV encourages regenerative braking and allows gentle acceleration.
Design a new operation mode
Ancillary power consumption during vehicle drop-off stops contributes to higher total energy consumption. The FCEV will implement a new operating mode lowering ancillary power and automatically switching the vehicle off after the FCEV has stopped for a number of minutes to reduce energy consumption.
I’m very interested to see how this data stacks up against a similar electric vehicle. It certainly gives First Hydrogen plenty of data to optimize their own vehicles.
Their test vehicles are definitely a proof of concept milestone. Now I would imagine their next big milestone will be to ramp up their production of test vehicles to get more crucial data for further optimization.
As they state in their news release, they are planning to do further real world testing in Europe and expand into North America.
I live in Central Mexico, in the state of Aguascalientes. When moving from north to south and east to west, it requires coming through central Mexico so Aguascalientes is a hub that is one of top 3 safest cities in Mexico.
Mexico is benefitting from being right beside America and seeing the economic advantages of nearshoring. The state of Aquascalientes is growing rapidly due to nearshoring.
When I think about First Hydrogen moving into North America, due to low costs of manufacturing products in Mexico, I clearly see that Mexico and places like Aguascalientes could be great fits.
Mexico just elected Claudia Sheinbaum to replace Andrés Manuel López Obrador (AMLO). President-elect Claudia Sheinbaum served as secretary of the environment for AMLO in the past. She has a degree in energy engineering, and has written many articles about energy, the environment and sustainable development.
Mexico has the potential to become an economic powerhouse because it is right beside the largest economy in the world and can compete with China on producing practically everything. Plenty of global companies see this and are rushing into Mexico for the nearshoring opportunities.
Living in Mexico, I see this on a daily basis in the business news and before my eyes in the city where I live. Real estate growth is remarkable and it has a lot to do with the big international companies moving into Aguascalientes for nearshoring business opportunities.
MIT Sloan Management Review did a report analysing the top 10 cities in Mexico that will benefit from nearshoring. Aguascalientes was ranked 6th, noting the manufacturing flows into the state, with automotive manufacturing clustered in the region leading the charge.
I’m fortunate to know a lot of business people in Aguascalientes and have talked to them about the potential for First Hydrogen to build hydrogen vehicles as well as hydrogen distribution stations. Some of them are well connected to government at the local, state and federal level.
They are very excited about the business opportunities for hydrogen vehicle manufacturing here in Aguascaliente and also believe that the government of Mexico under Claudia Sheinbaum would be interested in helping with funding.
Due to president-elect Claudia Sheinbaum’s professional experiences, she will be well aware of the potential for hydrogen vehicles and the role they could play as a transition to electric vehicles moving to widespread adoption.
Based on my experiences in Mexico, I believe that Mexico would be an ideal location for First Hydrogen to grow their business.
The bottom line for me is that I see First Hydrogen has the potential to grow into a much larger company. They are going through proof of concept working with companies like Amazon.
Next I see them advancing to ramping things up to prove the economics of their business plan.
All the best,
Allan Barry Laboucan
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