AFC Energy inks strategic supplier agreement with Zollner

22nd Jul 2024 12:37

(Sharecast News) - Hydrogen power generation technology specialist AFC Energy announced the signing of a strategic supplier agreement (SSA) with Germany's Zollner Elektronik on Monday.

The AIM-traded firm said Zollner would serve as the scaled manufacturing partner for the fuel cell modules of AFC Energy's S Series air-cooled platform.

It said the agreement marked the first SSA between AFC Energy and Zollner, Europe's largest electronics mechanical services contract manufacturer, which operates across seven sectors, four continents, and 24 locations globally.

The multi-year agreement would see Zollner undertake a phased build-up of fuel cell module production, encompassing wiring and looms, electrical panels and boards, balance of plant sub-assemblies, module assembly, stack integration, and module factory acceptance testing.

Production under the SSA would initially occur at Zollner's facilities in Germany, near Zandt, with the potential for international expansion across multiple continents to accommodate global growth.

Zollner's involvement was said to be pivotal in scaling up the production of AFC Energy's H-Power Generators, with orders placed in alignment with demand increases.

The SSA aligned with AFC Energy's strategy of low capital, outsourced contract manufacturing.

Immediate planning for the first phase of production, focusing on the fuel cell module's electrical assemblies and wiring, would start imminently.

"We are very proud to be working with Europe's leading mechatronics manufacturing partners in Zollner," said chief executive officer Adam Bond.

"Our strategy of leveraging the scale up manufacturing expertise of contract manufacturers has long been the core of our future product readiness and with such high demand for Zollner's services, we are extremely pleased to see alignment of our two companies and the complimentary opportunities that we are able to pursue in partnership.

"We look forward to a long and fruitful partnership with Zollner as we continue to support industry to meet its decarbonisation goals."

At 1218 BST, shares in AFC Energy were up 6.2% at 17.23p.

Reporting by Josh White for Sharecast.com.