This paper examines the experience of existing alternative fuel vehicle (AFV) programs in the US and China to provide insights into appropriate strategies for developing hydrogen vehicles and infrastructure in China. Although an increasing number of AFVs have been deployed in recent years, various factors have limited this progress, such as large sunk investments in conventional technologies, limited networks of refueling stations, the typically higher cost of AFVs, and the relatively low price of oil. Given these barriers, and additional barriers specific to hydrogen, a transition to hydrogen will be a slow process, and must be supported by both near- and long-term policies that have clear and measurable goals that take hydrogen beyond fleet applications into broader vehicle markets. Because a transition to hydrogen vehicles will not occur quickly, it is necessary for the government to have consistent and integrated transportation policies combining short- and long-term goals. These policies should draw upon resources from both governments and multinational companies to provide incentives for vehicle purchases, promote investment in infrastructure, and disseminate information to raise public awareness. Multinationals may find China to be an ideal testing ground for innovative hydrogen vehicles with appropriate incentive policies and programs. (c) 2006 Elsevier Ltd. All rights reserved.