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Fuel cells are electrochemical devices that convert chemical energy from reactants directly into electrical energy without combustion. They provide electricity that can be used to power electric motors in transportation applications such as buses, trucks, cars, trains, and vessels or to generate heat and power in stationary applications and portable power. Proton exchange membrane fuel cells (PEMFCs) are considered well-suited for transportation and small stationary applications due to their low weights and volumes. The global fuel cell market is dominated by PEMFC technology due to its ability to operate at low temperatures resulting in quick start-up times and high power densities.
The global Fuel Cell Market is estimated to be valued at US$ 8.5 billion in 2023 and is expected to exhibit a CAGR of 12.% over the forecast period 2023 to 2031, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
Growing demand for clean transportation is the prime driver for the fuel cell market. Governments across the globe are promoting electric vehicles to curb emissions from transportation which is a major contributor of greenhouse gas emissions. Fuel cells provide a more viable solution for cleaner transportation of goods and people compared to battery electric vehicles owing to faster refueling times and higher ranges. Hydrogen fuel cell technology allows zero-emission transportation matching battery range while refueling as quickly as gasoline vehicles. This is propelling OEMs to launch more fuel cell vehicles which is expected to boost the fuel cell market. Additionally, declining costs of PEMFC stacks due to technological advancements and mass production will make fuel cells more competitive against traditional internal combustion engines and lithium-ion batteries, thus augmenting the market growth over the forecast period.
Key players operating in the fuel cell market are Ballard Power Systems Inc., Cummins Inc., Plug Power Inc., Hydrogenics Corporation, Doosan Fuel Cell America, FuelCell Energy, Inc., Panasonic Corporation and Toshiba Fuel Cell Power Systems Corporation.
Segment Analysis
The global fuel cell market is dominated by the transportation sub-segment. The segment held more than 50% share of the overall market in 2020 owing to the use of fuel cells in electric vehicles, buses and trucks. The transportation sub-segment is dominating as many automobile manufacturers are launching electric vehicles powered by fuel cells due to their longer driving range and faster refueling compared to battery-powered electric vehicles.
PEST Analysis
Political: Many governments across the world are supporting the development and adoption of fuel cell technology through funds, subsidies and incentives to reduce dependence on fossil fuels. They are promoting fuel cells for transportation and stationary power applications.
Economic: With falling production costs, fuel cells are becoming economically viable compared to conventional power sources. Many corporations are investing in R&D to commercialize fuel cell technology and tap new business opportunities in green energy sector.
Social: Growing environmental concerns and need to tackle climate change is increasing social acceptance of zero-emission fuel cell technology. People are willing to pay more for green vehicles and solutions.
Technological: Technological advancements are enhancing performance and lifetime of fuel cells. New catalysts, membranes and system design improvements are helping reduce costs and make fuel cells more efficient.
Key Takeaways
The global Fuel Cell Market is expected to witness high growth over the forecast period of 2024 to 2031 supported by rising demand from automotive, stationary and portable power industries.
Regionally, Asia Pacific dominated the market in 2020 and is expected to retain its leading position through 2031 due to favorable government policies and high production activities in countries like China, Japan and South Korea.
*Note:
- Source: Coherent Market Insights, Public sources, Desk research
- We have leveraged AI tools to mine information and compile it
