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Japanese carmakers, infrastructure developers forge hydrogen station venture

Honda Motor Co. Ltd. said it has teamed up with 10 other companies, including automakers and infrastructure developers, to establish a venture that will build 80 hydrogen stations in Japan for fuel cell vehicles, or FCVs, by fiscal year 2021.

The new venture called Japan H2 Mobility LLC, or JHyM, will operate starting April 2018 and set a 10-year timeline to "complete its mission." The new venture's target of 80 hydrogen stations is aligned with the government road map to have 160 hydrogen stations in Japan serving around 40,000 FCVs by fiscal year 2020, the automaker said.

Aside from hydrogen station deployment, JHyM will work to make hydrogen stations more convenient such as by increasing the number of service days per week, as well as look into reducing costs.

Honda said infrastructure developers in the alliance will contribute some capital, construct hydrogen stations, and operate them. The automaker added that investors will partially cover station deployment costs "until the hydrogen station business becomes commercially sustainable," which will help "reduce the initial financial burden borne by infrastructure developers and will help attract new participants."

JHyM's partner companies also include JXTG Holdings Inc. subsidiary JXTG Nippon Oil & Energy, Nissan Motor Co. Ltd., Idemitsu Kosan, Iwatani Corp, Tokyo Gas, Toho Gas, Air Liquide Japan Ltd. and Toyota Tsusho, Reuters reported.

JXTG Nippon Oil operates at least 40 of the roughly 90 hydrogen stations in Japan, with another 10 in the planning or construction stage. The Japanese petroleum company's senior vice president, Yutaka Kuwahara, said March 5 that a lack of users and high building and operating costs for fueling stations have slowed construction, delaying the Japanese government target to build 100 stations by March 2016, the report added.

"We must lower costs, which will remove many of the bottlenecks to developing more stations," Kuwahara reportedly said. It currently costs about 400 million yen to 500 million yen to build a hydrogen station, but the Japanese government aims to roughly halve the cost by about 2020. The high costs of FCVs and limited production capabilities further hamper hydrogen adoption, Reuters said.

Toyota one of a few automakers currently marketing FCVs along with Honda and Hyundai Motor Co. has sold only 5,300 of its Mirai FCV since its launch in 2015, compared with around 11.5 million gasoline hybrids sold since launching the Prius 20 years ago, Reuters added.