Azure Dynamics, a Canada-based developer of hybrid electric and electric powertrains for commercial vehicles, has closed its head office in Toronto as well as the UK Kenilworth office and service center. The company plans to open a new corporate head office in or near Detroit.
The scope of our work with Ford as well as other leaders in the automotive sector makes the establishment of the head office in the Detroit/Windsor area, or possibly Ohio, a natural next step for Azure.
In addition, these practical moves are expected to provide cost savings in excess of $1.6 million annually. The cost savings are related to both fixed costs for facilities and people, as well as in variable costs, such as travel. We will be resolving very quickly, what financial incentives might be available to Azure before finalizing our location, as many jurisdictions view the high-tech nature of the hybrid business as the key to the future of the automotive business.
It has become clear that North America is leading the world in hybrid electric vehicle adoption. While there is great future promise in Europe and Asia, for efficiencies sake, we want to develop those markets on the back of our North American sales volumes. By concentrating on a successful launch of our Ford E 350 and E 450 hybrid business and on specific large supply agreements, such as the electric powertrains to Mexico, we can start to build the economies of scale that will ensure we are in a very competitive position for the rest of the world markets.—Scott Harrison, Azure Chief Executive Officer
In October 2006, Azure Dynamics signed an agreement with Ford Motor Company to enable Azure to develop a hybrid electric powertrain for Ford’s E-series commercial platform. (Earlier post.)
Azure also announced that its revenue for the first quarter of 2007 dropped 80% to $0.2 million from $1.1 million in the first quarter of 2006. The revenue was lower in the first quarter of 2007 due to decreased activities in funded engineering contracts in the Boston operation as the Company is now focused on its core production programs.
Net loss for the first quarter of 2007 was $6.5 million, or $(0.03) per share, compared to a loss of $4.6 million or $(0.03) per share in the first quarter of 2006. The company attributed the higher net loss in the 2007 quarter primarily due to lower margin contribution due to lower revenues and higher levels of engineering and operational activities as the development of the Ford P1 parallel hybrid vehicle and ramp-up of the G1 series production progresses.