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Milestone: First Stimulus-Backed Electric Vehicle Ready to Roll

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How’s this for a special delivery? Navistar (s NAV) today fired up the assembly line for its eStar electric truck at a plant in Indiana’s Elkhart County, and said it’s ready to hand the keys to customer No. 1, FedEx (S fdx). According to the Obama administration, that makes Navistar “the very first Recovery Act recipient to deliver an electric vehicle” with funding from the highly competitive battery grant program.

Powered with batteries from fellow stimulus grant awardee A123 Systems (s AONE), the vehicle is a commercial delivery truck dubbed the eStar. Navistar hopes to deliver a total of 400 units by the end of 2010.

The DOE awarded a $39.2 million grant last summer to Navistar under the $2.4 billion stimulus program for electric drive and battery manufacturing. Over the last 10 months, Navistar says it developed and delivered prototypes of the model, put it through testing and validation and received certification from state and federal environmental regulators.

In the original announcement of the grant award meant to support development of 400 trucks — each weighing some 12,100 pounds, with 100-mile range capacity and able to carry 4,000 pounds — the DOE said Navistar would manufacture the vehicles at its plant in Elkhart and deploy them in Portland, Ore., Chicago and Sacramento, Calif. The local South Bend Tribune, reporting from Navistar’s Wakarusa plant in Elkhart Thursday, says the eStar is now expected to head to those three cities, as well as Indianapolis and Los Angeles. According to Navistar’s announcement Thursday, FedEx will be evaluating the eStar within a fleet operating in the L.A. area.

Matt Rogers, senior adviser to the Secretary of Energy, confirmed in a call with reporters today that the eStar will mark “delivery of the first electric vehicle supported by the Recovery Act.” He emphasized the speed of this project, saying the vehicle is “moving off the line” on the “450th day since passage of the Recovery Act,” rather than taking 4-5 years as a government-backed project of this sort might have taken historically.

Navistar has hit a speed bump, however, on the road to high-volume production. Rogers said the company will be “ramping up production as A123 is able to ramp up supply for them.”

A123 VP of Automotive Solutions Jason Forcier told us earlier this year that the battery maker is on track to have a high-volume line up and running in Livonia, Mich., by the end of 2010 to handle larger-scale production in 2011 and beyond, for customers including Fisker Automotive.

So until capacity increases across the still-developing supply chain for electric vehicles, Navistar will produce the eStar at relatively low volumes and offer fewer than the 700 new jobs pledged in its application for the DOE grant, Rogers said. According to the Tribune, 40 employees “will be involved in the initial production in Wakarusa.” But the company expects to eventually produce thousands of eStar vehicles per year and create 700 jobs across the U.S. through the project, including jobs added at suppliers.

Photo courtesy of Navistar

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One Response to “Milestone: First Stimulus-Backed Electric Vehicle Ready to Roll”

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