Plug Power Sees Electric-Car Fuel Cells and First Profit
Plug Power Inc. (PLUG), a maker of fuel-cells that power fork lifts, may expand into a new market by adapting its systems to extend the range of electric vehicles, Chief Executive Officer Andy Marsh said.
The company is in talks with auto suppliers and component makers about producing fuel cells that may be attached to battery systems, Marsh said in an interview yesterday at Bloomberg’s headquarters in New York. He didn’t name the companies.
The combination would let vehicles continue on the road after draining their batteries, potentially allaying some of the range anxiety that has made them a tough sell to consumers for everyday use. The strategy may help the Latham, New York-based company report a profit by the third quarter of next year, he said. Plug hasn’t had a profitable quarter since its 1999 initial public offering.
“When I look at cost trade offs, there is a right mix of fuel cells and lithium-ion batteries,” he said. “It’s actually really simple. This is right in Plug Power’s strike zone.”
Plug was formed in 1997 as a joint venture of Michigan utility owner DTE Energy Co. (DTE) and Mechanical Technology Inc. (MKTY) to develop fuel-cell systems to power homes and small businesses. Fuel cells convert natural gas into electricity through a chemical process.
Marsh joined in 2008 and refocused the company on power systems for fork lifts. That boosted revenue to $7.5 million in the second quarter from $2.6 million in the first quarter of 2009. Expanding into new markets will further drive sales, he said.
“I can see the turn in the industry,” Marsh said. “All those markets Plug Power chased will eventually be there.”
As the fuel-cell industry expands, costs will come down, he said, making the systems more appealing for new markets including electric vehicles, he said.
“These technologies will become much more competitive,” he said. “It’s a much easier application than fork lift trucks.”
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