Azure Dynamics LLC, which is Ford Motor Co.'s retrofitter of electric powertrains, has filed for bankruptcy protection in Canada after it was unable to obtain additional financing. In addition, the company disclosed that after years of losses, it stopped producing its electrified Ford Transit Connect vans. Ford sells the vans at several dealers in Europe and North America.
Azure is in discussions with suppliers and customers to restart output, the company's vice president of marketing Mike Elwood told The Wall Street Journal. Vice president of investor relations Juris Pagrabs also said to the paper that the company's best opportunity to resume production rests with another company which would acquire the EV assembly business. Without a purchaser, production would likely be stopped permanently, the paper revealed. Azure is seeking buyers, the paper further reported.
Azure is reorganizing to become an engineering and consulting company. It was established in British Columbia prior to its transfer to the Detroit area in 2008. After the announcement of the bankruptcy filing, Azure laid off 120 employees (out of the 160) in Oak Park, Mich.; Vancouver, British Columbia; the United Kingdom; and Boston, Elwood revealed. Azure was planning a stock offering in a range from $12 million to $20 million to investors in Canada and the U.S. However, the Ontario Securities Commission did not accept its filings this month. The failure to obtain liquidity pushed Azure to seek bankruptcy protection, CEO Scott Harrison related.
In March, Azure posted more sales of its electric Transit Connect with a total of $32 million during the past 12 months. However, the startup did not become profitable. The company had to make $50 million to $60 million in annual revenue in order to be profitable, according to Harrison in past interviews with Crain's. Azure posted a loss of $9.84 million in the quarter ending September 30, 2011, on revenue of $12.43 million. It reported $38 million in revenues last year and sales were around 800 units. In 2010, Milwaukee-based Johnson Controls Inc. invested at least $6 million in Azure. The Michigan Economic Growth Authority also approved state tax credits of $1.3 million for the company.