Friday October 30, 08:48 AM
UPDATE 1-Tanfield says SEV, Ford terminate Transit Connect deal
* Says forecast volumes did not justify investment needs * Says project limited working capital for Newton trucks (Adds details)
Oct 30 (Reuters) - Britain's Tanfield Group Plc said its associate company Smith Electric Vehicles
(SEV) US Corp and Ford (NYSE: F - news) agreed to terminate their Transit Connect project as forecast volumes did not justify the investment requirement.
The commercial electric vehicles maker said on Friday it withdrew from the deal to develop a battery-powered van as it believed the project limited the working capital for the growth of its Newton trucks.
'SEV US believes that investing in the existing Smith platforms represents a better use of its financial resources, Tanfield said in a statement.
'It was concerned that the market for electric car-derived vans would become increasingly competitive,' the company said.
SEV US started production of the Newton electric truck platform in Kansas City, Missouri and now has an order book of 255 trucks, it said.
The company said it was gaining real traction with its core products in the electric van and truck sectors across the world.
Tanfield shares were unchanged at 35.5 pence at 0829 GMT on the London Stock Exchange (LSE: LSE.L - news) .
(Reporting by Tresa Sherin Morera in Bangalore; Editing by Vinu Pilakkott) Keywords: TANFIELD/
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