Sources of radical technological innovation: the emergence of fuel cell technology in the automotive industry

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Sources of radical technological innovation: the emergence of fuel cell technology in the automotive industry

Hoed, Robert van den

This paper explores the way in which radical innovations that offer qualitatively better performance in terms of sustainability may or may not come to pass within a large, established industry that is not usually associated with such dramatic changes. In particular, it explores the case of the development of fuel cell technology as a replacement for the internal combustion engine in the products of the automotive industry, with a focus on understanding the conditions under which incumbents with a disincentive to change may ultimately become the means by which such change is introduced. The paper identifies five potential 'change factors' to explain the adoption of fuel cell technology, but concludes that it is a combination of the change factors that is important. Technological progress alone seems insufficient to explain its success, while environmental regulation has been a second crucial condition for the large investments in fuel cell technology. While carmakers engage with entrepreneurs and use their technology to gain competitive advantage, market factors have played a minor role in fuel cell technology adoption and entrepreneurs have lacked the resources, the credibility and the independence to become influential in radical technological change.