Hydrogen is a really small molecule that really, really wants to escape/leak when contained. It also creates embrittlement issues with steel, which tends to get used in IC engines and cars in large quantities. These are not trivial problems.
If we had a stream of pure hydrogen available for energy purposes, there are perfectly good fuel cells that would yield three times the mechanical energy, as burning it in an IC engine. Hydrogen is an energy medium, not an energy source.