Wales-based hydrogen fuel cell vehicle manufacturer Riversimple and Siemens UK have signed a memorandum of understanding (MoU) to formalise plans to jointly work on a number of fronts, the key one being sustainability initiatives.

“We have been very wary of who we develop relationships with in the past,” Hugo Spowers, MD of Riversimple, tells Hydrogen Economist. “We have avoided car companies because their business models simply do not fit with what we are trying to do.

“We will own the car until its end of life—so we design it for sustainability, not built in obsolescence” Spowers, Riversimple

“If your business model is about selling cars, you are about consumption, and that does not fit with consumers or the planet anymore. What we are doing is building revenue-generating assets as part of a business model that is driven by life costs, not build costs.”

Riversimple is preparing to start offering its hydrogen-powered cars on a service contract, under which the vehicle can be rented for a fixed monthly fee plus a flat-rate mileage allowance. In addition to the vehicle itself, the subscription package will include maintenance, insurance, tyres and fuel.

“We will own the car until its end of life—so we design it for sustainability, not built in obsolescence. This brings us a longer revenue stream, which will lower the build cost and bring the cost of hydrogen cars in line with petrol-engine ones.”

Siemens support

Spowers says the old model of “dig up, make, sell”, is not fit for purpose in the 21^st century. “That model is an ‘accelerating funnel’ that will close in on you,” says Spowers. “We want to decouple our revenue from dependency on virgin resources.

“Siemens understands what we are trying to do and has its own circular thinking in product design, supply chain management and economic models. It can help us mature our business model, to a point where we can use third-party supplier products as a service.”

Siemens will also be using its expertise to help Riversimple win crucial funding. Riversimple has appointed Gambit Corporate Finance and opened an investment round that aims to raise £150mn ($208mn) over the next three years, with which it would fund two manufacturing plants. It estimates that each plant would create around 220 skilled jobs directly, making 5,000 vehicles a year.

The company aims to start commercial production of its eco coupe, the Rasa, in 2023, and a light goods vehicle the following year. To date, the company has funded its research and development through grants and crowdfunding.