Hydrogen Storage Vessels

In the burgeoning hydrogen economy, manufacturers of specialized cylinders, tanks and trailers for transporting and storing hydrogen have been among the earliest to translate momentum into tangible results. On the one hand, companies such as Chart Industries, Hexagon Purus, Faurecia and Plastic Omnium are employing established technologies and manufacturing processes developed to serve the legacy grey hydrogen industry. On the other hand, these manufacturers benefit from an attractive pricing and margin environment in that their products are (1) specialized, 2) vital for green hydrogen initiatives and (3) represent only a small portion of overall costs to implement those initiatives.

With those dynamics in place, the sales pipeline appears to have converted into contracted orders more quickly than in some other sectors of the hydrogen economy. Chart recently noted that it had booked orders for 60 hydrogen trailers in the last 12 months, an amount that exceeds its already expanded capacity for 2022 while Hexagon Purus reported 96% YoY growth in Q3 sales. And while granular disclosure is limited, segment reporting directionally points to the potential for 30%+ margins.

Notably, strong order activity has also translated into strategic activity as industry leaders seek to add capabilities and markets. Recent examples include Hexagon Purus’s acquisition of an industrial gas compression capability and Faurecia’s acquisition of a hydrogen tank manufacturer in China. Plug Power also recently announced the acquisition of an industrial gas tank and trailer company, Applied Cryo Technologies, to bolster its hydrogen transportation operations.

Taken together, these developments offer more early evidence of hydrogen initiatives moving from planning to implementation.

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