Vancouver-based Ballard Power
Systems sits at the leading edge of the fuel-cell revolution — but judging from
the Canadian company’s recent financial report, the revolution is on hold.
Ballard’s
partners include automotive heavyweights Ford, DaimlerChrysler, and Honda. And
public-relations stunts are in full flower: DaimlerChrysler recently dropped off
a fleet of experimental fuel-cell vehicles at
The goods news — for Ballard,
anyway — is that it managed to reduce its financial losses to $83 million in
2004, which compares favorably with the $175.4 million loss the company posted
in 2004. The company’s cash reserves held steady at around $233 million and the
company shipped or booked for customers in
However, revenue, a critical
measurement for any kind of start-up or company dabbling in new technology,
dropped by a third in 2005 to $53.7 million from $81.4 million. The sale of a
European venture but the company’s revenues also declined because key automotive
customers deployed fewer test vehicles last year than they did in 2003 or 2004,
according to the company’s abbreviated financial reports.
Meanwhile, Ballard, which has been
one of the pioneers in the development of commercially viable fuel-cell systems,
is still holding discussions with another unidentified automotive partner,
according to the company’s latest reports. The company’s automotive engineers
also showed a fuel stack that could start at very cold 25 degrees below zero
Centigrade and dropped off demonstration vehicles in
Ballard also reported it was
pushing ahead with efforts to commercialize some of the fuel-cell technology it
has under development. However, at $73 per kilowatt hour, the energy Ballard has
developed remains very expensive.
Thus, while Ballard is in pretty
good shape, the financial results suggest that the automakers themselves have
grown more skeptical about the prospects for some kind of a breakthrough in
fuel-cell technology. Ballard noted the spending on engineering went up in 2005
but it’s hard to detect any sense of real urgency or a breakthrough in the
financial numbers.
John Sheridan, Ballard’s newly appointed president and chief executive officer, said, “2005 was an important year for Ballard as we repositioned the company and developed a commercial strategy with a sharper focus, which has opened new opportunities for Ballard in materials handling and backup power markets.”
“As well, our natural gas-fueled
cogeneration fuel cell product captured the leading position in the Japanese
market and Ballard-powered fuel cell vehicles continued to demonstrate
outstanding performance in automotive markets around the world,” Sheridan
added.
Ballard’s goals for 2006 are
relatively modest. It is planning to continue its push into the residential
cogeneration market in
In addition, Ballard will continue
with its automotive experiments and its officials said last week the Canadian
company is in an excellent position to meet the goals laid out in its technology
roadmap.
However, despite the growth of its
commercial business and relative financial stability, Ballard expects only
modest growth in its revenue to around $55 million to $60 million this year.
Sheridan, who served as Ballard’s
non-executive chairman before accepting the chief executive role, also stressed
the near term when he accepted the CEO role.
“While the fuel-cell sector has
been through some tough times over the past few years, I’m excited by
Ballard’s repositioning and our near terms and mid-term opportunities,” said
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