Johnson Matthey’s Hydrogen Pivot: 2025 Strategy, Divestments, and Key Partnerships

Industry Adoption: Johnson Matthey’s Shift from Broad Ambition to Focused Commercialization

Between 2021 and 2024, Johnson Matthey (JM) pursued a broad, capital-intensive strategy to lead the emerging hydrogen economy. The company consolidated its hydrogen efforts into a single Hydrogen Technologies business in September 2021 and pledged to invest approximately £1 billion by 2030. This strategy targeted both blue and green hydrogen, with its LCH™ technology selected for major UK blue hydrogen projects like bp’s H2Teesside and Equinor’s H2H Saltend, while simultaneously investing £80 million in a 3 GW gigafactory in Royston, UK, to scale up production of catalyst coated membranes (CCMs) for the green hydrogen sector. However, this ambition clashed with market reality. The division accumulated significant losses, posting a £50 million operating loss for the 2023-24 fiscal year and consuming an estimated £310 million in cash since 2022, leading to intense pressure from its largest shareholder, Standard Investments, to de-risk or sell the unit.

The year 2025 marks a dramatic inflection point, shifting from broad ambition to disciplined execution. Facing financial headwinds, JM executed a strategic retreat and refocus. The company slashed its green hydrogen spending by a staggering 83% in early 2025 and, in a pivotal move, sold its entire Catalyst Technologies business—including its flagship LCH™ blue hydrogen technology—to Honeywell for £1.8 billion. This divestiture fundamentally reshaped its strategy, forcing a laser focus on its core competencies in high-value, technologically advanced components. The new strategy is twofold: dominating the supply of CCMs for fuel cells, validated by a major long-term partnership with Bosch, and pioneering the nascent but promising market for hydrogen internal combustion engine (H₂ICE) after-treatment systems. This is evidenced by the successful completion of Project Brunel with Cummins and the £2.5 million investment in a dedicated H₂ICE testing facility in Gothenburg, Sweden. This pivot from a capital-intensive project enabler to a high-margin component supplier signals a pragmatic response to market conditions, prioritizing a clear path to profitability over speculative, wide-ranging investments.

Table: Johnson Matthey’s Strategic Hydrogen Investments and Divestments (2021-2025)

Table: Johnson Matthey’s Evolving Hydrogen Partnership Landscape (2021-2025)

Geography: Johnson Matthey’s Shifting Global Footprint

Between 2021 and 2024, Johnson Matthey’s geographic focus was heavily concentrated in the United Kingdom, driven by its ambitions in the blue hydrogen market. Major projects like H2Teesside, H2H Saltend, and HyNet positioned its LCH™ technology at the heart of the UK’s industrial decarbonization strategy. This was complemented by foundational green hydrogen investments in the UK, such as the £80 million Royston gigafactory. Concurrently, the company made strategic inroads into the USA (through its key Plug Power supply deal), China (signing an agreement for a CCM plant in Shanghai), and mainland Europe (with partnerships in Germany and Norway). This period reflected a broad, multi-regional strategy aimed at capturing opportunities across key emerging hydrogen hubs.

From 2025 onwards, the geographic landscape has shifted to align with the new, focused strategy. While the UK remains important for R&D and H₂ICE development (Project Brunel), the center of gravity for commercial activity has moved. Germany has become pivotal through the deep collaboration with automotive giant Bosch on CCMs. Sweden is now a key location with the opening of the dedicated H₂ICE testing facility in Gothenburg, targeting the European heavy-duty vehicle market. The USA remains a critical market, but the focus has sharpened to e-fuels and biomethanol, confirmed by the SunGas Renewables partnership. The sale of the blue hydrogen business to US-based Honeywell also marks a significant transatlantic value transfer. A new strategic region, India, has emerged with a £24 million investment in an R&D hub, signaling a long-term play in another high-growth market. This evolution shows a move away from concentrating on UK-centric, large-scale infrastructure projects toward embedding its high-value component and fuel technologies within the world’s major automotive and industrial manufacturing ecosystems.

Technology Maturity: Johnson Matthey’s Path from R&D to Commercial Focus

In the 2021-2024 period, Johnson Matthey managed a portfolio of hydrogen technologies at varying maturity levels. Its blue hydrogen (LCH™) technology was its most commercially advanced offering, moving from proven concept to selection for front-end engineering and design (FEED) stages in multi-billion-dollar projects like H2H Saltend, signaling pre-commercial scaling. In parallel, its green hydrogen components (CCMs) were in a rapid scaling phase, underscored by the £80 million investment in the Royston gigafactory and a major supply agreement with Plug Power. Newer technologies like HyCOgen™ (for e-fuels) were launched and achieved early commercial validation through selection by HIF Global, while circular economy concepts like HyRefine™ recycling were still at the lab-scale demonstration phase. This period was characterized by parallel development and early commercialization across a broad technology front.

The period from 2025 to the present reflects a decisive shift towards commercializing a narrower, more focused set of technologies. The sale of the mature LCH™ technology to Honeywell represents a strategic exit to monetize a scaled asset. Simultaneously, CCM technology has been fully validated as a core, commercially scaling business, evidenced by the co-development partnership with Bosch, which moves beyond simple supply to deep integration for mass-market automotive applications. The most significant development is the rapid maturation of H₂ICE after-treatment systems. This technology has leapfrogged from collaborative projects (Project Brunel) to a dedicated commercial-scale testing facility in Gothenburg, positioning JM to capture a new market segment. Furthermore, its e-methanol (eMERALD™) and ammonia cracking technologies have achieved major commercial proof points through their selection for large-scale production plants by Reolum and Doosan, respectively. This demonstrates a clear strategy: harvest value from mature assets and double down on commercializing technologies where JM has a distinct, high-margin competitive advantage.

Table: SWOT Analysis of Johnson Matthey’s Hydrogen Strategy Evolution

Forward-Looking Insights and Summary

Johnson Matthey’s actions in 2025 signal a clear path for the year ahead: a relentless focus on profitability through targeted commercial execution. The narrative is no longer about capturing every opportunity in the hydrogen economy but about winning in carefully selected, high-margin segments. The primary signal to watch is the financial performance of the Hydrogen Technologies division; its ability to meet the stated goal of breakeven by the end of the 2025/26 fiscal year will be the ultimate test of this new strategy.

Two key areas are gaining significant traction and warrant close attention. First is the hydrogen internal combustion engine (H₂ICE) space. JM’s investment in the Gothenburg facility and its collaboration with Cummins indicate a strategic bet that H₂ICE will be a pragmatic and faster-to-market decarbonization solution for heavy transport. Announcements of new engine and vehicle manufacturer partnerships will be a leading indicator of success. Second is the commercialization of the Bosch partnership. Market actors should watch for milestones related to the qualification of JM’s CCMs and announcements of their inclusion in specific vehicle platforms, as this will cement a major, long-term revenue stream.

Conversely, broad-based, speculative investment in hydrogen is losing steam. JM’s pivot serves as a cautionary tale for the industry: technological leadership alone is insufficient without a clear and timely path to commercial returns. The company has traded breadth for depth, and its future now hinges on its ability to convert its world-class catalysis expertise into tangible profits within the narrower, but potentially more lucrative, niches of fuel cell components and hydrogen engines. This disciplined approach is a bellwether for a maturing hydrogen sector increasingly focused on sustainable business models over hype.

Frequently Asked Questions

Why did Johnson Matthey dramatically change its hydrogen strategy in 2025?
The change was a direct response to significant financial losses and slow market development. The Hydrogen Technologies division posted a £50 million operating loss for the 2023-24 fiscal year and was under intense pressure from its largest shareholder, Standard Investments, to de-risk. This forced the company to pivot from a broad, capital-intensive strategy to a focused approach with a clear path to profitability.

What is Johnson Matthey’s focus in the hydrogen market now?
After selling its blue hydrogen business, Johnson Matthey has adopted a new twofold strategy. The company is now focused on: 1) Dominating the supply of high-value catalyst coated membranes (CCMs) for fuel cells, validated by its partnership with Bosch. 2) Pioneering the market for hydrogen internal combustion engine (H₂ICE) after-treatment systems, demonstrated by its collaboration with Cummins and investment in a dedicated testing facility.

What happened to Johnson Matthey’s LCH™ blue hydrogen technology?
In a pivotal move in May 2025, Johnson Matthey sold its entire Catalyst Technologies business—which included the flagship LCH™ blue hydrogen technology—to Honeywell for £1.8 billion. This divestment was a core part of its strategic retreat to exit capital-intensive projects and focus on high-margin component supply.

Who are Johnson Matthey’s most important new partners in its refocused hydrogen strategy?
Two partnerships are central to JM’s new strategy. The first is a long-term collaboration with German automotive supplier Bosch to co-develop and produce CCMs for fuel cells, validating its technology for the mass market. The second is the collaboration with engine manufacturer Cummins on “Project Brunel,” which successfully proved JM’s after-treatment catalyst for hydrogen internal combustion engines.

What is the new financial goal for Johnson Matthey’s Hydrogen Technologies division?
After incurring significant losses, the primary goal for the refocused Hydrogen Technologies division is to achieve profitability. The company has publicly stated its target is to reach operating profit breakeven by the end of the 2025/26 fiscal year, signaling a shift from speculative investment to a focus on sustainable commercial returns.