H2View: Discipline before expansion - Marty Neese's roadmap for Ballard

In an interview with industry publication, H2 View, on November 3, Marty Neese detailed how Ballard Power Systems is stripping things back to basics - focusing on what works, cutting what doesn't, and betting the discipline will deliver where hype hasn't. 

By Edward Laity, H2View

Ballard's new CEO has called on employees to adopt the same relentless mindset as the company’s toughest global competitors, warning that without it, the fuel cell maker risks being outperformed.

With one restructuring program complete, Neese, now four months into the job, said the focus is on execution along three pillars: product–market fit, leverage-based cost control, and capital discipline.

Appointed in July, Neese served on Ballard’s Board of Directors for the past 10 years and was previously the CEO of U.S. electrolyser manufacturer Verdagy. In his first Ballard earnings call, Neese told investors he aims to transform the firm into a “sustainable cash flow positive business” by the end of 2027.

With less than a year and a half to do it, Neese said the first job is to pinpoint what customers truly value, what they’ll pay for, and how Ballard’s portfolio can deliver – a discipline he said was honed at Verdagy.

That philosophy underpinned the launch of Ballard’s latest fuel cell module, the FCmove^®-SC, unveiled at Busworld in Belgium this October.

Designed for hydrogen buses, the system is positioned to deliver Neese’s desire for simplicity, integration, and serviceability. It is said to offer 30% more power, 25% higher density, and 40% fewer parts.

“When I saw that product in its earliest form, you could see it was scalable – manufacturable at low cost, high precision, and volume,” Neese told H2 View. “We plan to have that same kind of mentality across our platforms as we address other markets and opportunities.”

But if product–market fit was “job one,” the next is far less forgiving. Neese must cut costs, pull financial levers, and reshape operations to weather low revenues, tariffs, and delayed hydrogen uptake.

Finding financial levers

On his appointment, Neese insisted the firm would reduce annual operating expenses by at least 30% in 2026 through job cuts, streamlined operations, and “tighter portfolio integration.”

In Q2 2025, Ballard’s gross margin improved by 24 points to –8%, supported by lower manufacturing overheads and the full impact of its 2024 restructuring. “Execution is fundamental,” Neese said during the earnings call.

“It starts with simplifying and driving down costs across every operation, product, and process, paired with disciplined capital management.”

The progress built on Ballard’s first quarter, where it narrowed its gross loss margin by 14 points to –23%. Its 2024 restructuring had already cut operating expenses by 31% through headcount reductions and executive changes.

In Q1, revenues rose 6% year-on-year to $15.4m, but with 81% tied to bus-related projects and relatively low volumes weighed against manufacturing overheads, margins remained negative.

For Neese, though, this isn’t about “brutal cuts” alone, but about finding and using the most impactful financial strategies to improve the company’s performance. The focus instead will be on higher-margin products to help achieve positive cash flow by the end of 2027.

“We must identify the maximum points of financial leverage,” he told H2 View, pointing to measures like switching to newer parts suppliers to improve product margins.

Ballard’s manufacturing processes are also being examined. “If we invest in automation, where do we get the most bang for the buck, or the most leverage?

“That automation extends across every stack we make, in any product, anywhere… It’s more about… getting the absolute most out of where you put $1 to work, and where you get an outsized return on that dollar.”

Neese hopes this discipline will become a permanent mindset. “There’s no such thing as ‘done,’” he said. “There’s only a half-life chart – can we reduce by 50%, then another 50%, and another 50%? That goes on in perpetuity.

“All you need to do is look at the latest solar cost curves – that would have been unimaginable 20 years ago. Bringing that same mindset to Ballard as a leader, not just a board member, is what I’m trying to instil.”

“We’re bringing a strong focus on improvement across every row of the balance sheet and income statement,” Neese added.

“The sum of parts will add up to the beneficial results we hope for, but it takes patience and there’s no magic wand,” he added, setting expectations for Ballard shareholders that improvement will be gradual and discipline-driven.

A Ballard fuel cell solution for the stationary market

Discipline before buildout

Beyond operational levers, Neese is also recalibrating Ballard’s capital commitments, including its 3GW fuel cell gigafactory planned for Rockwall, Texas, which was originally slated to reach a final investment decision (FID) in 2024.

Neese confirmed the plant’s developments “remain on amber,” as the company focuses on maximizing output from its existing footprint before scaling up.

He said during the Q2 earnings that there isn’t a need for additional capacity “on the horizon,” noting that automation investments would extract more from existing facilities before expanding footprint. “You always strive for more out of your installed capacity,” he said.

Neese told H2 View that Ballard has “barely scratched the surface” of its current capabilities. With the right methods, he said, output could double by cutting cycle times and improving efficiency.

Pulling back from China

The same approach extends to Ballard’s geographic exposure, with the company now “materially on pause” in China. Neese confirmed the outlook as a “wind-down investment path” to H2 View.

In 2018, Ballard established a joint venture (JV) with Weichai Power to develop and manufacture fuel cell products for China’s fuel cell electric (FCEV) market, arguably the largest and most advanced EV market. According to GWGI data, the nation is set to deploy up to 6.2 million FCEVs annually by 2050.

However, Ballard previously stated the Weichai JV underperformed due to local fuel cell firms being prioritised in projects. Ballard has not invested in China “in any way, shape or form” in 2025.

“The landscape in China supports local demand from local companies,” Neese explained. “It’s not as conducive to companies outside the ecosystem. They’re looking to win in China with their own assets before thinking about export.

“We’re looking to make clear where it does or does not fit in our portfolio. It’s less clear on the demand environment how the Chinese market is available for us to address.

“We’ve stopped approaching the demand side of the China market and instead have been using the supply side of the supply chain to help us lower costs for customers.”

Instead, Neese emphasized that the strongest near-term traction continues to come from the bus and rail segments in Europe and North America.

Buses driving recovery

“Hydrogen has a very strong role to play here,” the CEO told investors in August. The bus segment now represents over 80% of Ballard’s revenue, while there are early signs of growth in rail, material handling, and stationary power.

Neese told H2 View these markets share similar product-market attributes and can benefit from the same cost-down and scalability strategies.

Ballard fuel cells have logged over 300 million kilometers in real-world bus operations, proving their reliability, durability, and commercial readiness, according to Neese.

Ballard powers New Flyer's Xcelsior CHARGE FC™ fuel cell bus - which currently has more than 220 units in operation across North America

The recovery followed a turbulent 2024, when Ballard’s revenues fell 32% despite shipping a record 56MW of fuel cell engines – almost 30% more than in 2023. The downturn hit its rail, truck and marine segments, but bus sales rose 51% year-on-year to $44.2m.

“The bus market has been key for us and it’s becoming more and more attractive,” the CEO said. “It’s starting to hit the tipping point, in which the infrastructure costs of going battery-electric are starting to look interesting.”

He emphasized that the future of zero-emission fleets isn’t a fight between hydrogen and batteries, but rather a hybrid, pragmatic mix driven by economics.

“As soon as you start assessing objectively how to transition your fleet to zero emissions, you find out pretty quickly that the electrical infrastructure required becomes cost-prohibitive at a certain point.

“That’s where hydrogen-based fuel cell replacements for zero emissions start really shining more. It’s not to say that battery-electric doesn’t have its place. It does. It just says fleet operators are understanding how to deploy the right motive solution for the right routes and duty cycles.”

Can buses sustain momentum?

However, the question remains over whether the bus segment can remain a sustainable source of income for Ballard in the long run.

Many industry voices expect hydrogen-powered bus operations to dominate near-term refuelling demand, particularly in Europe, while others have highlighted the significant costs attached to operating a hydrogen bus.

Yet for Neese, the bus market’s value lies in its margins. He sees buses as a bridge to wider applications, not Ballard’s sole growth engine.

“The leverage comes in that fleet learning and innovation required to serve them, which can be applied to other opportunities like rail, material handling, stationary power, and trucks as they adopt,” Neese explained. “These are core markets that will contribute to decarbonization, too.”

Nevertheless, the CEO recognized that industrial decarbonization will vastly outweigh mobility. “At Verdagy, we went straight into refining complexes,” Neese said. “That’s where the biggest opportunities for deep decarbonization exist.”

Underlining the scale, he added that even if 10,000 zero-emission buses or trucks were decarbonized, they wouldn’t match the carbon reduction impact of a single refinery switching to clean hydrogen.

“On scale, the industrial sector has to decarbonize first,” Neese said. “Mobility will benefit from the cost-down work.”

Ballard's headquarters in Burnaby, British Columbia

The path to parity

The CEO told H2 View the next phase for Ballard will be defined by steady, incremental progress, not sweeping transformation.

“I’m on a path with the team: one step at a time, one row at a time on the P&L, balance sheet, and income statement,” he said. “Just steady improvements. We’re in good shape to continuously improve.”

Neese said the approach will mirror the wider maturity of the hydrogen sector itself. For him, real success will come from reaching a point of true competitiveness, rather than hype or headline-grabbing announcements.

“I think you’re going to see fossil parity across more than one market,” he said. “In solar, we fought to get to grid parity. Once we achieved it, macroeconomic gravity kicked in — economic adopters turbocharged demand.

“It’ll be the same in electrolysis. As we find paths toward fossil parity, adoption will take off, and I think we’ll beat diesel,” Neese concluded.