• South Korean consultancy SNE Research projects China’s annual FCEV sales will grow from 38,000 units in 2030 to 933,000 by 2040, with green hydrogen production rising from 2.0 million tonnes to 17.6 million tonnes over the same period.
• China’s automotive fuel cell system market is forecast to expand from around KRW 790 billion [~$595m USD] in 2030 to approximately KRW 12.8 trillion [~$9.64bn USD] by 2040, driven by heavy commercial vehicles and falling system costs.

2026 China Hydrogen Industry Outlook Market Shifting and Growth Opportunities (~2040) [Photo: SNE Research]

SNE Research has published its 2026 China Hydrogen Industry Outlook, projecting that China’s fuel cell vehicle and hydrogen markets will shift into large-scale commercial deployment after 2030 once the current demonstration phase ends.

China’s automotive fuel cell system demand stands at 6.9GW in 2030. SNE Research says growth will be driven largely by higher-power systems for heavy commercial vehicles, including 49-tonne tractor-trailers, with demand rising to 46.1GW by 2035 and 233.3GW by 2040. Even as system costs fall — from a current target of 570 yuan per kW toward below 270 yuan — the report says rising demand volume will expand the overall market faster than costs contract.

2040 Forecast

By 2040, SNE Research expects China to account for 35.9% of global fuel cell system demand, 30.7% of global FCEV sales, and 30.6% of hydrogen refuelling stations, projected at 1,450 stations nationally. China’s share of global green hydrogen production and electrolyser capacity will fall from 54.1% in 2030 to 32.0% in 2040 — but SNE Research attributes this to faster growth in other markets rather than any contraction in China’s absolute scale, which it projects to grow roughly nine-fold and seven-fold respectively.

New Pilot Programme

China’s first FCEV pilot group ran from 2021 to 2025. After it ended, a subsidy gap caused China’s FCEV sales to fall 54.5% year-on-year in the first half of 2026 to 918 units. The government responded in March 2026 with a “Notice on the Development of a Comprehensive Application Project for Hydrogen Energy,” targeting an end-user hydrogen price of 25 yuan per kg [~$3.45 USD] by 2030 in vehicle applications and 100,000 FCEVs on the road by 2030. Five urban clusters — Beijing, Guangdong/Greater Bay Area, Northeast–Yangtze Delta, Xinjiang–Sichuan/Chongqing, and Yellow River–Central Plains — were confirmed in August 2026. SNE Research says China’s hydrogen policy focus has shifted from vehicle supply to demand creation covering mobility, industry and green fuels.

Refuelling Capacity

Meeting 2040 demand across 1,450 refuelling stations would require each station to handle around 22 tonnes per day at 65% utilisation. Current large-format station designs run at 12 tonnes per day, which SNE Research calculates can supply only about 55% of projected demand. On green fuels, announced plans total around 8.1 million tonnes of hydrogen equivalent, but projects at the operational or final investment decision stage cover only about 1.1 million tonnes.

Korean Supplier Opportunities

SNE Research identifies components requiring high reliability, verification, safety systems and operations and maintenance as areas where Chinese manufacturers still need external technology. The report estimates the accessible Korean market opportunity at KRW 192–648 billion [~$145m–$488m USD] for fuel cell components and testing, KRW 223–506 billion [~$168m–$381m USD] for hydrogen storage and tanks, and KRW 47–284 billion [~$35m–$214m USD] for electrolyser components and O&M.

SNE Research expects China to become one of the world’s largest hydrogen commercial-vehicle and fuel-cell markets after 2030 and recommends a phased entry strategy for Korean suppliers tailored to the needs and partner structures of each city cluster.

Source:   FCW Team