Smith Electric Vehicles on last leg, production suspended

Smith-Newton-electric-delivery-truck

Smith Electric Vehicles suspended production at the end of 2013 due to cash shortages, but made no announcements about the closure. It was disclosed in a required filing with the U.S. Department of Energy as part of grant requirements – the DOE awarded $32 million to Smith Electric in 2010.

The company reported to the DOE that it suspended production due to the company’s “tight cash flow situation” and has not been responding to questions from the press, with phones going unanswered or questions being answered with “No comment.” 

Smith-Newton-electric-delivery-truck

The DOE told the Associated Press that it is working with Smith Electric to ensure the demonstration project that was supposed to have Generation 2 Smith trucks in fleets this year will complete. That project requires 510 trucks be placed in fleets, which is the sum total of trucks produced thus far by the company, but not every project truck has been delivered, according to the DOE.

Smith’s filing noted that the company had only $2.9 million of the initial $32 million loan left in its coffers. The roughly 100 employees at the company’s Kansas City headquarters are nearly all on leave.

Problems for Smith became apparent in 2012 when well-publicized plans for expanded production in two other locations were quietly scrapped and production numbers at the current facility were downsized to about half their announced expectations.

Issues with the Smith Electric truck are many and mostly revolve around financing and economics. The extremely high up-front cost of the truck is not easily offset by fuel savings over time and so relies very heavily on government-supported grants and incentives to sell to fleet owners. Famously, felets like Frito-Lay, Coca-Cola, and Staples were getting the electric trucks nearly free of charge once all incentives and grants were accounted for. Insiders have said that were this not the case, the truck would likely never have been adopted at all.

Enhanced by Zemanta
You can leave a response, or trackback from your own site.

One Response to “Smith Electric Vehicles on last leg, production suspended”

  1. […] to a report on GreenBigTruck.com, Smith Electric Vehicles, makers of the battery electric Newton delivery truck, suspended […]

Leave a Reply

CommentLuv badge