EARLY success for a North- East electric vehicle firm’s US operation has led to it turning its back on a much-heralded partnership with Ford.

Smith Electric Vehicles US Corp (SEV US Corp), which is 49 per cent owned by the Wearside-based Tanfield Group, expressed delight in February when a partnership agreement was reached with Ford to develop and introduce the electric version of the Transit Connect van in the US.

But since then, SEV US Corp, which was established earlier this year, has seen growth in demand for its own Smith Newton truck, designed and developed in the North-East, with orders for 255 of the vehicles on its books.

As a result, the company, which started production at a new plant at Kansas City International Airport this month, has “mutually agreed” to terminate its development project with Ford.

It said that forecast volumes “did not justify the investment requirement and limited the working capital available to support the growth of Newton”.

A Tanfield Group spokesman said: “The Smith Newton is doing even better than we expected in the US.

“As a relatively young operation out there, it has limited resources and we felt the best use of the resource is to run with the production of the Smith Newton.”

It is understood that there is no ill-feeling with Ford over the decision and Tanfield remains Ford of Europe’s official collaborator on commercial electric vehicles.

Ford still intends to launch its own electric version of the Connect in the US and is understood to be looking for a new partner for that project.

Tanfield also announced yesterday that SEV US Corp, which was established as a joint venture with US investors in February, had received an additional $4.5m grant from the US Government on top of $10m it was awarded to build up to 100 electric vehicles, in August.

The new grant is for 65 Smith Newton trucks through the US Clean Cities Program.

The truck, created on Wearside by the Smith Electric Vehicles division of the Tanfield Group, is already being used in the US by Coca-Cola, Staples, Frito-Lay, AT&T, Pacific Gas and Electric Company (PG&E) and Kansas City Power & Light (KCP&L).

The company also announced a new partnership with US military and commercial vehicle company AM General, maker of the Humvee jeep, to jointly develop an electric vehicle for the US Postal Service.

Additionally, Tanfield was yesterday confirmed as the largest supplier to phase one of the UK Government’s Low Carbon Vehicle Procurement Programme.