Westport Fuel Systems Inc., a supplier of advanced alternative fuel delivery systems and components for the global transportation industry, has signed an investment agreement to establish the previously announced joint venture with Volvo Group to accelerate the commercialization and global adoption of Westport’s HPDI fuel system technology for long-haul and off-road applications.
The closing of the JV is subject to certain conditions, including regulatory and government approvals. This JV is expected to become operational following the formal closing, which should occur in the second quarter of 2024.
“We are excited to execute this agreement and build on our success with the Volvo Group and our HPDI technology,” says Dan Sceli, CEO of Westport. “We are motivated to keep innovating and investing in strong business relationships with leading organizations that share our goals, of which Volvo Group is certainly one. Powered by our shared vision for a cleaner tomorrow, we look forward to further collaboration and providing real solutions to decarbonize the long-haul and off-road transport sectors.”
As previously announced, Westport will contribute certain HPDI assets and opportunities — including related fixed assets, intellectual property and business — into the JV. Volvo Group will acquire a 45% interest in the JV for the sum of approximately $28 million, payable upon closing, plus up to an additional $45 million as an earnout depending on the subsequent performance of the JV.
Westport’s HPDI fuel system offers OEMs the flexibility to differentiate their biogas, natural gas, hydrogen and other fuel product lines easily while maintaining maximum commonality with their conventional diesel-fueled products. Using HPDI, greenhouse gas-emitting fuels including diesel can be replaced with carbon-neutral or zero-carbon fuels such as biogas or hydrogen while maintaining the durability, affordability, efficiency and performance characteristics of diesel.
