Obama pledge could be major boost for Tanfield

Jan 13 2009 By Andrew Hebden, The Journal

TANFIELD is hoping to be one of the big beneficiaries of US President-Elect Barack Obama’s pledge to rescue the American car industry using alternative technologies.

The North East company is at the forefront of electric vehicle development and yesterday saw its shares soar by 21% after being named-checked by US motor giant Ford as a key part of its plans move into electric and hybrid car production.

The Washington-based manufacturer is in the vanguard of companies aiming to make the North East a global leader in the electric car industry.

Nissan, which last week announced the loss of 1,200 jobs in Washington, is also researching alternative technologies, and Business Secretary Lord Mandelson has called on the Japanese giant to manufacture its electric vehicles in the North East.

Tanfield produces the hybrid electric Edison Van, Newton Truck and the Ampere, a car-based van under its Smith Electric Vehicles brand. It is also working on the development of a hybrid taxi and is part of London Mayor Boris Johnson’s new Electric Vehicle Partnership.

Its technology is poised to play a major part car production as the once mighty US motor companies suffer plunging sales in the teeth of the economic storm.

Tanfield chairman and founder Roy Stanley said: "What America is looking at is that they want to create new jobs and they realise the car industry needs to reinvent itself in the alternative fuel technology."

US President George Bush has agreed to bail out General Motors and Chrysler with $17.4bn in emergency loans, but the motor industry has to meet targets in return for the money. President-Elect Obama, who takes office next week, said the industry will not be allowed to collapse but it must restructure.

Mr Stanley said: "That bail-out is on condition they really invest heavily in bringing big new technology to the market. Ford are working in partnership with people such as ourselves, they are working in collaboration in order to bring new technology to the market.

"We’re already producing the Edison with Ford using the Ford Transit. The Ampere – we’ve got pre-production models now – is going to go into production in the second half of the year."

Mr Stanley is confident the region will become a world player in new vehicle fuel technologies.

"The region, particularly through work One North East is doing, is really trying to set its stall out – principally through ourselves and Nissan – to be the leading region not just in the UK and Europe but globally," he said.

Mr Stanley said discussions were going on with a number of parties about transforming the North East into a global leader for alternative vehicle technology but he could not comment on whether there would be a future link up between Tanfield and Nissan.

Tanfield’s collaboration with Ford was originally announced at the Commercial Vehicle Show in Birmingham last April and the two companies had been working together on a less formal basis for around two years.

The company reported a 91% growth in operating profits to £10.3m, in the six months to the end of June last year but made a first-half loss of £65m at the pre-tax level mainly due to a series of exceptional writedowns of its goodwill and assets of £75m.