Sevcon is an electric car firm and it has announced its intention of doubling its engineering staff in the North-East. This will increase the number of engineering staff to 80 and it also hopes to bring in worldwide sales staff. The announcement comes as the company looks for £6 million from shareholders to help support its growth.
The business is based in Gateshead and is also listed on the NASDAQ stock exchange in the U.S. It has launched a rights issue and says a portion of the funding will be used to pay for overseas acquisitions. The president and chief executive, Matt Boyle, believe the on and off-road hybrid and electric vehicle market is set to take off globally in the very near future. The rights issue comes after a successful recent period where profits and revenues have risen sharply.
The company’s Team Valley HQ is where it employs its existing team of 40 hardware and software engineers. It is also where Sevcon conducts research and product development. Boyle said that the company needed to double the size of its staff to meet projected demand and also has to expand to increase its global sales team. He was excited to say new opportunities are presenting themselves and it was important to scale the business to meet this new demand.
Sevcon recruits from around the world but like many companies of its ilk in the North East, it believes schools don’t do enough to encourage the studying of STEM subjects nor do the schools help students pursue engineering careers. Last year, Sevcon established a student bursary scheme and is paying the tuition of four students at Northumberland University and Newcastle University.
Line of Electric Cars. Image: Google UK
The majority of Sevcon’s sales are overseas with China and Asia in general highlighted as important sales areas. Earlier in the year, it joined up with Chinese automotive company Risenbo Technology which operates as Sevcon New Energy Technology. The plan is for this company to sell Sevcon merchandise to tier one automotive suppliers in China.
According to Boyle, the Chinese are well ahead of the rest of the world when it comes to low carbon vehicle adoption. By the end of the year, six million older vehicles will be taken off the roads and replaced with electric cars or vehicles that cause less pollution. Governments in the Far East also want to ensure buses and trucks are responsible for a lower amount of carbon emissions and will promote hybrid technology along with pure electric cars.
More details of the rights issue have been announced on NASDAQ and the company announced that proceeds would be used to develop the company and fund ongoing research and acquisitions of other businesses. Boyle believes that when Sevcon identifies a suitable acquisition, it will have the necessary resources to quickly complete a transaction.
Sevcon enjoyed revenues of almost £11 million in the six months to the end of March 2014 which compares favourably with the £8.6 million earned in the first six months of 2013. Profits were slightly over £530,000 which is again a significant improvement on the £940,000 operating loss reported in the first half of 2013