Following recent reports it suspended production, a producer of all-electric medium commercial vehicles, Smith Electric, has secured a $42 million investment so it can resume operations.
The money is coming from Sinopoly Battery Limited, a Chinese company which develops, produces, distributes and sells lithium-ion batteries and related electric vehicle products.
The investment will position Sinopoly as a strategic shareholder in Smith Electric, according to a release. Under the agreement, Sinopoly will become Smith Electric's exclusive supplier for batteries in vehicle applications that are compatible with Smith Electric's platforms and customer requirements. Sinopoly will also become a preferred supplier for certain electric vehicle components that can be manufactured in its Hangzhou, China facility.
Smith Electric says it will resume production in its Kansas City, Mo., facility in mid-summer. The company temporarily suspended production in the fourth quarter of 2013 “in order to transition its supply chain to Tier 1 suppliers, which will enable Smith Electric to produce its vehicles at a lower cost.”
Smith Electric reportedly lost $127.6 million in 2009 through June 2012, and that it used most of a $32 million grant from the U.S. Department of Energy to build a total of 439 electric trucks by the end of 2013.
"Demand for all-electric commercial vehicles is rapidly increasing in China, and Sinopoly's investment in Smith Electric highlights the important role we will play in the global marketplace," said Bryan Hansel, chief executive officer of Smith Electric Vehicles. "This investment provides both companies with the opportunity to leverage the synergies between our operations while Smith maintains the financial and operational flexibility to scale manufacturing, transition and strengthen our supply chain, and move toward company profitability."
Charles Gassenheimer is now chairman of the board of Smith Electric Vehicles. He was appointed to his role in April and brings extensive private and public financial markets experience, as well as significant operational expertise in the electric vehicle industry, according to the company.