Startup car company Elio Motors Inc. and Canadian supplier Linamar Corp. said today they formed a partnership to produce engines for Elio’s three-wheeled vehicle.
Elio, of Phoenix, has been developing the oft-delayed vehicle that company founder and CEO Paul Elio has called an “autocycle.”
The 0.9-liter, three-cylinder engine was developed with Elio’s partner IAV. Elio said the engine is expected to reach 84 mpg.
Financial terms of the agreement were undisclosed.
“Elio Motors has developed an engine with a rare blend of power and fuel efficiency that could have significant market potential beyond powering the Elio,” said Elio in a statement. “Linamar will use its global presence and access to international manufacturers in automotive, marine and industrial markets to identify other uses for our engine and open up potential additional revenue for our company.”
Linamar is also partnering with Elio to manufacture engines for use in the automotive, marine and industrial sectors outside of the U.S. Linamar will be a component and subsystem supplier for Elio Motors’ other driveline and chassis systems in North America, the statement said.
“Not only does this give us great penetration into ultra-high mileage vehicles, it also gives us a chance to sell this highly efficient engine to a variety of markets and customers,” Linamar CEO Linda Hasenfratz said in a statement.
The engine will be manufactured at Elio’s Shreveport, La., assembly plant, the company said.
The vehicle is set to sell for $6,800.
But Elio has faced financial troubles and has had difficulty getting the vehicle project under way.
The company, which said in a March regulatory filing that it has accumulated a deficit of about $53.8 million, also noted “we anticipate generating a significant loss for the current fiscal year.”
The bulk of commercial production will not begin until 2017, three years after its initial goal, Elio said in April.
Previously, the company planned to deliver the vehicles to the more than 50,000 people who preordered them in 2014 and 2016.
Also in April, the company said it was going to assemble test vehicles at a pilot operations center in Livonia, Mich.
John Irwin contributed to this report.
