Shock from Hyzon Motors

The figures for the second quarter should be published August 15, 2022 at the latest, but Hyzon surprisingly reported that certain sales in China were not followed through in time to be able to be booked (“revenue recognition in China”) and that there are “operational inefficiencies” at Hyzon Motors Europe B.V., the subsidiary in Holland. Earlier statements (balance sheet publications) are therefore invalid or obsolete for the time being. This is a real shock after all the news about orders, corporate partnerships, production ramp-up and the recent acquisition in Germany.

Craig Knight has left Hyzon


Hyzon has time from now to October 14, 2022 to file the necessary figures for the second quarter as well as the corrections for the previous quarters with the SEC (US Securities and Exchange Commission) and Nasdaq. After that, there is an optional extension of 180 days if the deadline cannot be met.

“The Company’s Board of Directors (the “Board”) appointed a committee of independent board members to investigate, with the assistance of independent outside counsel and other advisors, certain issues that were brought to the attention of the Board by Company management. These issues include revenue recognition timing, presentation, internal controls and procedures, primarily pertaining to its China operations.”



That the board chairman, Craig Knight, is immediately leaving the company, having been relieved from his post, suggests that something major must have gone wrong. The new chairman will be Parker Meeks, who was previously chief strategy officer – a McKinsey man with an impressive career. He will temporarily lead the company as interim CEO until a suitable new CEO is found.

Acquisition of the ORTEN Group

The expansion of the company is proceeding according to plan despite the aforementioned problems, as the production facility in Rochester, NY and Chicago, IL demonstrate, as well as the start of MEA (membrane electrode assembly) production in the US and the current job ads for new personnel suggest. Hyzon has additionally received a funding decision and can now apply for state subsidies for trucks in the US (California and New York).

In order to better position itself in Europe, Hyzon has acquired the ORTEN Group (ORTEN Betriebs-GmbH and ORTEN Electric Trucks GmbH), one of the pioneers in the conversion of used and new diesel to battery-electric and hydrogen-powered trucks. With this, 80 employees have moved over to Hyzon, and it is also a good complement to the activities in Holland. Hyzon Europe ORTEN makes mainly trailers and truck conversions for the beverage industry of up to 26 tonnes load weight. Hyzon is thus also entering the battery-electric sector, like Nikola Motors has already. The aim is to be able to offer the shipper or truck buyer several options. The retrofitting of existing vehicles (chassis of diesel trucks) seems an important optional step. Thus Hyzon is addressing the right market and wants to be active not only in Asia but also in Germany and Europe.

DB Schenker intends to rent out Hyzon trucks via hylane

Cooperation with Schlumberger

Major corporation Schlumberger is known mainly for oil drilling, where it is one of the heavyweights. Now the two have started a joint development program in which Hyzon’s FC stacks are to be put into use in various heavy devices and vehicles as well as oil drilling platforms (rigs) for Schlumberger. These can be energy systems on drilling platforms as well as other heavy-duty equipment. The goal is to operate a drilling platform completely with hydrogen energy-wise (2.5 tonnes per day).

In the fourth quarter of this year, there will be a first joint showcase project, according to the press release. Typical 4-MW diesel generators are to be replaced by fuel cell systems. With such partnerships, new emphases are to be set. It’s an accolade for Hyzon to be running a test series with a company like Schlumberger and perhaps then receiving larger orders. I would rather have seen a company like Cummins Engine in this position, only theoretically. But for Hyzon, this is a good and important step by which to bring its own FC technology to a wide audience.

In addition, there will be a memorandum of understanding that will be filled with content from a concrete project. In the coming twelve months, the Schlumberger subsidiary Ensign Energy Services Inc. will integrate a Hyzon FC system into an existing oil platform. Side note: Hyzon developed its own fuel cell technology throughout more than 20 years of research and is therefore not dependent on suppliers of such.

It is clear to us that the company, after all matters have been clarified, is executing its corporate strategy as planned, as already indicated by the presence of the interim CEO at specialist conferences. The share will certainly remain very volatile, owing to the existing uncertainty. Should after deduction of all possible losses and after balance sheet adjustments, among other things, the cash on hand still amount to over 300 million USD – it was over 400 million at the end of the first quarter – the stock exchange should take this into account in the valuation of the company.

I would say: Buy on bad news – but only for investors with a very speculative attitude and traders who know how to use daily fluctuations in the share price to their advantage. The course will have to be a bumpy ride – a roller-coaster ride. Perhaps a competitor is also using the situation to get on here and take advantage.

Investment banks like JP Morgan have of course revised their estimates downwards following the latest publications, though do not advocate selling now and completely breaking up with Hyzon. Is a 400 to 500 million USD loss in value at the stock market justified by the current situation of uncertain information? After all, Hyzon has many high-profile investors. In addition, blocks of shares held by insiders account for more than 60 percent of shares issued.

We’re going crazy: On the one hand, the important trust in the company is lost until clarity (figures, financial statements) is achieved. There may be adjustments for certain financial transactions (stock purchase by Holthausen and transformation of Hyzon Motors Europe B.V.?), if therein lies the problem – and only if. What’s clear: Class action lawyers may be able to take advantage of the situation. Rejoicing are the short sellers, who in the meantime had bet about 20 million shares on a price drop. On August 5, 2022 alone, the share price fell by over 38 percent. Now short sellers can profit massively from this, while some others might also think of tucking in until the time the company provides clarity.


Each investor must always be aware of their own risk when investing in shares and should consider a sensible risk diversification. The FC companies and shares mentioned here are small and mid cap, i.e. they are not standard stocks and their volatility is also much higher. This report is not meant to be viewed as purchase recommendations, and the author holds no liability for your actions. All information is based on publicly available sources and, as far as assessment is concerned, represents exclusively the personal opinion of the author, who focuses on medium- and long-term valuation and not on short-term profit. The author may be in possession of the shares presented here.

Author: Sven Jösting, written August 30th, 2022

Image: DSC00006.jpg/ Source: hylane

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