Bosch sees a place for renewable fuels, challenging proposed European Union engine ban

Aria Alamalhodaei
·2 min read

Bosch executives on Thursday criticized proposed EU regulations that would ban the internal combustion engine by 2025, saying that lawmakers “shy away” from discussing the consequences of such a ban on employment.

Although the company reported it is creating jobs through its new businesses, particularly its fuel cell business, and said it was filling more than 90% of these positions internally, it also said an all or mostly electric transportation revolution would likely affect jobs. As a case in point, the company told reporters that 10 Bosch employees are needed to build a diesel powertrain system, three for a gasoline system — but only one for an electrical powertrain.

Instead, Bosch sees a place for renewable synthetic fuels and hydrogen fuel cells alongside electrification. Renewable synthetic fuels made from hydrogen are a different technology from hydrogen fuel cells. Fuel cells use hydrogen to generate electricity, while hydrogen-derived fuels can be combusted in a modified internal combustion engine (ICE).

“An opportunity is being missed if renewable synthetic fuel derived from hydrogen and CO2 remains off-limits in road transport,” Bosch CEO Volkmar Denner said.

“Climate action is not about the end of the internal-combustion engine,” he continued. “It’s about the end of fossil fuels. And while electromobility and green charging power make road transport carbon neutral, so do renewable fuels.”

Electric solutions have limits, Denner said, particularly in powering heavy-duty vehicles. The company earlier this month established a joint venture with Chinese automaker Qingling Motors to build fuel cell powertrains in a test fleet of 70 trucks.

Bosch’s confidence in hydrogen fuel cells and synthetic fuels isn’t to the exclusion of battery-electric mobility. The company, which is one of the world’s largest suppliers of automotive and industrial components, said its electromobility business is growing by almost 40%, and the company projects annual sales of electrical powertrain components to increase to around €5 billion ($6 billion) by 2025, a fivefold increase.

However, the German company said it was “keeping its options open” by also investing €600 million ($721.7 million) in fuel cell powertrains in the next three years.

“Ultimately Europe won’t be able to achieve climate neutrality without a hydrogen economy,” Denner said.

Bosch has not been immune from the effects of the global semiconductor shortage, which continues to drag into 2021. Board member Stefan Asenkerschbaumer warned that there is a risk the shortage “will stifle the recovery that was forecast” for this year. Taiwan Semiconductor Manufacturing Company executives told investors earlier this month that the situation may persist into 2022.