31 October 2025
Hydrogen-powered vehicles face a rough road
By Priyanka Mohapatra
Article Summary
Some OEMs are scaling back their plans for hydrogen-powered vehicles. Understand why and the road ahead for this alternate fuel technology.
Once heralded as a promising alternative to battery-electric vehicles (BEVs), hydrogen-powered vehicles are now grappling with infrastructure bottlenecks, high costs and a highly niche market, especially in the light-vehicle segment. As some players exit the market, these challenges have begun to reshape corporate priorities and investment plans across the industry.
OEMs scale back plans for hydrogen-powered vehicles
Several automakers have recently scaled down or exited their hydrogen fuel-cell programs, underscoring the fuel type’s limited momentum:
On Oct. 10, General Motors (GM) announced it would discontinue developing next-generation hydrogen fuel cells under its HYDROTEC brand, citing high costs and limited US hydrogen infrastructure. The company will instead focus on batteries, charging technology and electric vehicles (EVs), where there is clear market traction.
On July 16, Stellantis announced it will discontinue its hydrogen fuel-cell technology development program, citing limited hydrogen refueling infrastructure, high costs and insufficient consumer incentives. The company no longer expects hydrogen-powered light commercial vehicles to gain traction before the end of the decade and will no longer launch its hydrogen-powered Pro One lineup this year, originally slated to begin production this summer.
On Feb. 18, the Court of Economic Activities of Versailles, France, initiated legal liquidation for HYVIA after failing to find a buyer. Formed in June 2021 as a 50/50 joint venture between Renault Group and Plug Power, HYVIA aimed to focus on hydrogen mobility, especially for light commercial vehicles (LCVs), and planned to capture a 30% market share in the fuel-cell electric vehicle (FCEV) LCV segment by 2030. However, HYVIA struggled with high innovation costs and slow hydrogen ecosystem growth in Europe and, in December 2024, announced that it had entered into a legal recovery procedure.
Insufficient refueling infrastructure slows hydrogen fuel-cell vehicle adoption
A shortage of hydrogen refueling stations (HRS) remains a major barrier to widespread FCEV adoption, especially for light vehicles. According to H2Stations.org, by the end of 2024, there were about 1,160 HRS in operation worldwide, compared to around 4.5 million EV charging stations.
Unlike EVs, FCEVs cannot be charged at home. High setup and operating costs, combined with low FCEV adoption, have forced many HRS to close. As FCEVs gain traction in the medium- and heavy-duty commercial vehicle segment (MHCV), operators are increasingly prioritizing MHCV refueling over passenger cars.
On Feb. 17, H2 Mobility announced it will close HRS in several German cities by the end of March. The company is instead expanding hydrogen infrastructure for buses and commercial vehicles, prioritizing larger refueling stations with 350-, 500-, and 700-bar options.
Additionally, FCEVs remain costlier than BEVs due to the expensive fuel cells and refueling is pricier than for gasoline-based cars. Continued government and industry funding and incentive programs will be crucial to support hydrogen mobility and infrastructure and help overcome these obstacles.
Not all players are pulling the plug on hydrogen mobility
Despite these setbacks, BMW, Honda, Hyundai and Toyota are still proceeding with their FCEV plans.
In Sept. 2024, BMW announced plans to launch its first-ever series production FCEV in 2028, in collaboration with Toyota. The companies will develop next-generation fuel-cell systems and expand hydrogen mobility infrastructure, sharing powertrain technology to reduce costs.
At the Advanced Clean Transportation Expo 2025, Toyota introduced its next-generation (Gen 3) fuel-cell system in North America, promising 20% higher efficiency and power than the previous system. The Gen 3 system is designed for both heavy-duty trucks and passenger vehicles, with a projected 600,000-mile service life for truck applications.
Jordan Choby, Toyota Group vice president of powertrain engineering, announced plans to introduce hydrogen-powered fuel-cell electric Class 8 heavy-duty trucks to decrease reliance on diesel-powered tractor-trailers servicing Toyota’s North America Parts Center California.
The company also announced new investments in Southern California hydrogen fueling infrastructure to support the rollout of hydrogen-powered Class 8 trucks and broader FCEV adoption.
In April, Hyundai unveiled the second-generation NEXO FCEV at the Seoul Mobility Show, which features a redesigned fuel-cell stack (maximum gross power of 110 kW), a new 150 kW electric motor and a larger 6.69 kg hydrogen tank, enabling a range of more than 700 km.
In February, at the H2 & FC Expo in Tokyo, Honda unveiled specifications for its next-generation fuel-cell module and power generator, with mass production planned for 2027. The new module will achieve a rated output of 150 kW and is being developed independently by Honda, unlike the current-generation module, which was co-developed with GM and is used in the existing CR-V e: FCEV model introduced in 2024.
However, given limited FCEV adoption, OEMs are exploring the application of fuel cells in other areas—such as stationary power generation, marine and aviation.
For instance, Toyota has partnered with Corvus Energy to develop fuel-cell systems for marine applications, and Honda is focusing on fuel-cell applications in stationary power stations and construction machinery, in addition to automotive uses.
Hydrogen-powered vehicles still in nascent stage
Compared to BEVs and hybrids, FCEV uptake is expected to be limited throughout the next decade. Even by 2037, FCEVs are expected to make up only 0.22% of the total global light-vehicle market, while BEVs are forecast to account for more than 50%.
S&P Global Mobility forecasts FCEV demand in the light-vehicle segment to increase from 9,211 units in 2025 to 220,000 units in 2037. As of 2025, Japan and Korea dominate the light-vehicle FCEV market, generating 71% of total demand.
This limited adoption is reflected in S&P Global Mobility’s fuel-cell stack demand forecasts from March, June and October 2025, which have notably declined. The June forecast is just 9,341 units, almost 33% less than the March forecast, while the latest October 2025 forecast predicts demand to drop further to 8,079 units—approximately 38% lower than March and 7% lower than June.
Figure 1: Fuel-cell stack demand change from March to October 2025
The path forward for hydrogen mobility
Government incentives, private investment, research and development funding and public-private partnerships are needed to drive FCEV development and adoption. As hydrogen infrastructure expands and costs decrease, FCEVs could play a larger role in the transition to sustainable transportation.
Kartik Ganesh, principal analyst, technical research, at S&P Global Mobility, notes, “The recent challenges faced by hydrogen FCEVs underscore the necessity for a robust infrastructure and sustained investment. While the road ahead may appear uncertain, the potential for innovation and collaboration among OEMs could pave the way for a more viable hydrogen economy in the future.”
Explore the latest trends and forecasts in hydrogen fuel-cell vehicle production and see how hydrogen-powered vehicles are shaping the future of mobility in S&P Global Mobility’s AutoTechInsight platform.
This article was published by S&P Global Mobility and not by S&P Global Ratings, which is a separately managed division of S&P Global.