Westport Fuel Systems shares rise on Volvo hydrogen deal
Westport Fuel Systems Inc. shares rose 11.29% to $2.07 following a development agreement between its Cespira joint venture and Volvo Group to finalize hydrogen engine technology. The deal targets a European commercial launch before 2030 for Volvo's 13-liter engine using HPDI fuel systems. Analysts project a narrower loss of 37 cents per share for the upcoming earnings report on Aug. 10, 2026.
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Westport Fuel Systems Inc. shares rose 11.29% to $2.07 on Thursday after its joint venture Cespira signed a development agreement with Volvo Group to advance hydrogen-powered heavy-duty engines. The agreement covers the final development and commercialization of Cespira's HPDI fuel system for Volvo's 13-liter engine platform, targeting a European-certified commercial launch before 2030. This move underscores Volvo Group's commitment to low-carbon heavy-duty transport through multiple technology pathways.
The agreement governs the activities required to extend the 13-litre engine platform to operate on hydrogen. Volvo trucks are currently undergoing on-road testing, a status previously announced by Volvo Trucks on April 1. The technology is designed to allow the engine to run on hydrogen while delivering diesel-equivalent performance using a zero-carbon fuel.
Cespira's HPDI fuel system enables direct injection of alternative fuels at high pressures into internal combustion engines. Westport stated that hydrogen HPDI can tolerate a wider range of hydrogen fuel compositions than fuel-cell systems and offers competitive performance and efficiency under heavy-duty load cycles. The system also allows for blending with natural gas to support better economics for stakeholders.
Mehdi Ferhan, Senior Vice President of Powertrain Technology at Volvo Group, emphasized the potential of hydrogen internal combustion as a viable long-haul option for fleets to reduce emissions in demanding applications. Cespira CEO Carlos Gonzalez highlighted that the technology enables fleets to reduce COâ‚‚ emissions without compromising performance and allows OEMs to adapt trucks to regional realities in fuel availability and infrastructure.
Key Features of the HPDI Technology
| Feature | Description |
|---|---|
| Fuel Type | Hydrogen, Natural Gas, Renewable Natural Gas |
| Injection Method | Direct injection at high pressures |
| Performance | Diesel-equivalent performance with zero-carbon fuel |
| Fuel Tolerance | Tolerates a range of hydrogen fuel compositions |
| Efficiency | Competitive with fuel cell systems in heavy-duty cycles |
Market Outlook
The next major catalyst for the stock is its expected earnings report on Aug. 10, 2026. Wall Street expects the company to report a loss of 37 cents per share, an improvement from a loss of $1.98 per share a year earlier. Revenue is projected to decline sharply to $2.29 million from $88.80 million in the year-ago quarter. Most recently, RBC Capital maintained its Sector Perform rating and lowered its price forecast to $1.75 on April 27.
What are the potential regulatory hurdles in Europe that could impact the commercialization timeline before 2030?
How will the infrastructure for hydrogen fuel availability evolve to support the commercial launch of these trucks?
What are the cost implications of scaling HPDI technology compared to fuel-cell systems for heavy-duty transport?
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