Mitsubishi & Daimler May Build Fuel Cell Cars Together
TOKYO, Nov 7 (Reuters) - DaimlerChrysler AG (DCXGn.DE) and partner Mitsubishi Motors Corp (7211.T) may develop fuel cell vehicles together, the Japanese automaker said on Tuesday.
Joint development of fuel cell cars would be a key step in an expected deepening of cooperation after the German-American auto giant took a 34 percent stake in Mitsubishi this year.
"We will be beginning work on cooperative projects with DaimlerChrysler, and the development of fuel cells will be under discussion," Mitsubishi Motors said in a statement.
Mitsubishi Motors has been working with group firm and its second-largest shareholder Mitsubishi Heavy Industries Ltd (7011.T) on fuel cell development for the past two years and an agreement is likely to include the comprehensive maker of heavy machinery.
Fuel cells, which make electricity from hydrogen and emit only water and heat, are widely seen as the main alternative to the internal combustion engine in the coming decades.
Rocketing energy prices across the world have only added pressure to the race to set the de facto standards for fuel cell vehicles. The issue of what fuels should be used to supply hydrogen is still being hotly debated.
Mitsubishi Heavy Industries said it would consider a proposal to work with DaimlerChrysler. It has been researching fuel cells for use in power generators for the past 20 years, although it has not yet brought a product to the market.
The companies' remarks follow a report in business daily Nihon Keizai Shimbun that the three firms were expected to sign an agreement early next year.
They would share development costs of more than 100 billion yen ($931 million) and aim to develop small and lightweight fuel cell systems in four to five years, which would then be used in a mass-market vehicle, the report said.
With DaimlerChrysler's purchase of a stake in Mitsubishi Motors, the two automakers agreed to work on developing a small car platform for world markets.
Although the alliance was originally seen by some analysts as mainly based around this one project, cooperation is expected to deepen quickly now that DaimlerChrysler has gained more management clout at Mitsubishi in the wake of a customer complaints cover-up scandal.
The auto giant will be installing its own executive, Rolf Eckrodt, as chief operating officer in January and DaimerChrysler chief Juergen Schrempp has said it is considering a major overhaul of the Japanese automaker.
By midday, Mitsubishi Motors' shares were down 1.52 percent at 389 yen, while Mitsubishi Heavy was down 17 yen or 3.47 percent at 473 yen.
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