The company has entered into an investment agreement with the Government of Anting in Shanghai’s Jiading District to establish its new China headquarters, membrane electrode assembly (MEA) manufacturing facility and R&D centre at a site strategically located at the Jiading Hydrogen Port, located in one of China’s leading automotive industry clusters.

Ballard plans to invest approximately $130m over the next three years, which will enable annual production capacity of approximately 13m MEAs at the new MEA production facility, supplying approximately 20,000 engines.

It expects to be able to achieve significant capacity expansion of this facility in future phases with much lower capital requirements. The facility will also include space to assemble approximately 600 engines annually to support the production and sale of Ballard engines in the rail, marine, off-road and stationary markets in China, as well as for certain export markets.

In 2021, Ballard completed its MEA manufacturing expansion in Canada, which is critical as the MEA is the core technology and limiting factor for Ballard’s global fuel cell engine production capabilities. With the new MEA capacity coming online in China, Ballard now expects its global MEA capacity to support total demand requirements through the second half of the decade.

This investment is expected to reduce MEA manufacturing costs, align with China’s fuel cell value chain localisation policy, and position Ballard more strongly in the hydrogen fuel cell demonstration cluster regions and for the post-subsidy market.

The facility is planned to be in operation in 2025 to meet expected market demand in China, including from the Weichai-Ballard Joint Venture (WBJV) for the bus, truck and forklift markets, as well as other opportunities outside the WBJV scope. The annual production capacity of the Weichai-Ballard joint venture facility located in Weifang, Shandong is approximately 40,000 stacks and 20,000 engines.

Randy MacEwen, Ballard’s CEO, said, its global manufacturing vision for 2030 is to have scaled ‘local for local’ manufacturing of leading fuel cell engines and components in our core regional markets of Europe, North America and China to support future industry growth patterns and volumes across its verticals.

“In the case of China, we already have volume manufacturing capacity for fuel cell engines, bipolar plates and stack assembly at our WBJV,” he said.

“With our continued high conviction on long-term scaled adoption in China of fuel cell electric vehicles for medium- and heavy-duty motive applications, we are now addressing long-term capacity in that market for our proprietary MEAs. We believe China is a market headed for a significant demand break-out as hydrogen infrastructure scales over the coming years and as our new MEA production facility comes online.”

Alfred Wong, Ballard China CEO, said, to be competitive in China requires investment on the ground.

“This new MEA manufacturing facility will significantly reduce MEA production costs, improve China market access and meet long-term market demand, including providing MEA supply to our Weichai-Ballard JV,” he said, adding that Anting, Jiading District, has quickly become a key hydrogen technology hub.

Ballard will also be setting up an R&D and innovation centre at the same site, which will be focused on MEA research to achieve key corporate technical advancements, support cost reduction initiatives, and engage the emerging China local supply chain for fuel cell materials and components.

Ballard also announced today that it has signed a non-binding Memorandum of Understanding (MoU) with Weichai Power whereby Weichai Power plans to make an equity investment for 2% of Ballard’s new MEA manufacturing company.