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Published on May 2nd, 2014 | by Andrew Meggison

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Smith Electric Vehicles Stops Production Of Its EVs

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May 2nd, 2014 by  

Originally published on Gas2.

smtih-electric

Smith Electric Vehicles of Kansas City has suspended production of its electric trucks and vans. While executives remain optimistic about Smith’s chances, even they had to acknowledge that building a handful of electric vehicles at an extremely high just isn’t a sustainable business model.

Smith Electric Vehicles started in 2009 with around 100 employees, and in 2010 Smith Electric was award a $32 million grant from the U.S. Department of Energy to develop electric utility vehicles. In 2011 Smith Electric planned on opening two additional plants in New York and Chicago, even meeting with The Bronx Overview Economic Development Commission and Chicago Mayor Rahm Emanuel.

Meanwhile, orders from big-name clients like Coca-Cola and Frito-Lay were coming in, and Smith Electric vehicles could even be found on military bases. The future seemed bright for Smith Electric Vehicles, at least until last week when Smith Electric suspended operations on its EVs due to a lack of capital.

So what the hell happened happened?

Blame competition. Natural gas powered and hybrid trucks are becoming more available and more popular in the trucking industry, and companies like VIA and AMP are also trying to edge into the commercial truck market. Smith may have had a head start, but the competition has accelerated past Smith since then.

Blame the business plan. Smith Electric relied heavily on the $32 million grant from the U.S. Department of Energy, allowing Smith to actually subsidize the purchase of electric vehicles to entice customers. In other words when a company like Frito-Lay purchased a Smith EV, they didn’t pay full price. While it may have gotten some customers through the door, it didn’t bring them back for more.

Blame a lack of understanding and interest in the EV market. Smith surely had grand ambitions and sales projects, but since 2010 the company recieved just 510 orders for its electric vehicles, of which only 439 have been built.

There’s plenty of blame to go around, but despite all this, Smith Electric Vehicles still hasn’t closed the door to its factory for good – production has just been stopped. Currently Smith Electric is in a state of reorganization in an attempt to make the business viable. Only time will tell if we’ll see any new Smith Electric Vehicles rolling out of the Kansas City plant.

Source: Kansas City Business Journal via Green Car Reports

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About the Author

Andrew Meggison was born in the state of Maine and educated in Massachusetts. Andrew earned a Bachelor's Degree in Government and International Relations from Clark University and a Master's Degree in Political Science from Northeastern University. In his free time Andrew enjoys writing, exploring the great outdoors, a good film, and a creative cocktail. You can follow Andrew on Twitter @AndrewMeggison



  • Fred Flintsone

    Their trucks sit in the maintenance shop more than they go on the road. super unreliable and no heat whatsoever in the winter.

    • Bob_Wallace

      From the Smith website –

      ” The Smith vehicle maintenance regime is simple; two daily fluid level checks on the electric motor and cab heater, plus an annual check on the batteries.”

      ” The truck is whisper-quiet as we drive along, no noise except for the whir of the heating fan and occasional thump from the suspension.”

      Sounds to me as if they have a cab heater.

  • NateOgden

    it was never a serious business. expanding in NY and IL shows it was always a political play and never a serious effort to run a business that could support itself.

  • JamesWimberley

    I suspect that every main-market electric vehicle manufacturer that will be around in 2024 exists already today. The economies of scale in manufacturing doom startups, unless they can borrow $500m.

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