Three major deals have seen revenues rise at electric vehicle component makers Sevcon.
The Gateshead firm is to produce parts for a German manufacturer, with the contract being its third major on-road win in the last 90 days.
The development work, which is being partially funded by Sevcon’s client, is expected to take two years, with volume production of the product slated to start in 2018.
Matt Boyle, president and chief executive officer of the NASDAQ-listed firm, said the contract win was testament to its Gateshead team.
He said: “This is something we have been working on for about nine months and it’s really a testament to the quality of people we have got in the North East, both from an engineering and support point of view.
“We have got a very skilled and honed group of engineers in Gateshead. When you are delivering engineering solutions to the Germans that’s saying something about the team.
“This success is another example of how our technology can be used to help customers with the electrification of their product.
“We see more opportunities with the increasing electrification of all classes of future vehicles, driven by the need for more efficient transport.
“We have been working very hard on these electrification applications around the world.
“In South East Asia we have to run 100 miles an hour to keep up – things happen very fast – but in Europe and North America they implement things much more slowly and we have to make a great deal of effort.
“But we stay the course and seeing how things are progressing is wonderful, it makes me proud.”
The contract announcement came as the business posted a 10% increase in first quarter revenues to $9.9m (£6.5m), up from $9m (£5.9m) in the same period last year.
Operating income fell over the quarter to $282,000 (£186,000), down from $710,000 (£468,000), due to the impact of investment in sales and engineering following a number of major recent contract wins.
Mr Boyle said the results represented a solid start to the year.
He said: “Sales were up 10% from the first quarter of fiscal 2014. This was driven primarily by increased product shipments for on-road hybrid and pure EV applications in all three of the geographic regions we serve. In addition, the increase reflects the commencement of the electrification program with a large German on-road OEM we announced today.
“This is the third major on-road win in the last 90 days.”
Sevcon said foreign currency fluctuations decreased reported sales by $268,000 (£177,000), or 3%, mainly due to a stronger US dollar versus the Euro and sterling.
Mr Boyle also talked of Sevcon’s “broadening” customer base and said the firm was working on a number of projects around the electrification of passenger cars and commercial vehicles with customers in the US, Europe and Asia.
In December last year the firm revealed a $50m contract with a tier-1 automotive supplier based in South East Asia, and in November detailed plans to begin manufacturing in Malaysia as part of a Chinese joint venture.