Tritium to close factory in weeks as investor talks continue

Troubled fast-charging firm Tritium confirms it will shutter its Brisbane factory before Christmas, with hundreds of local jobs to go.

A concept image of a super charging station owned by Brisbane-based EV specialist Tritium.

Troubled fast-charging firm Tritium has told shareholders it will close its Brisbane factory in the week before Christmas as it negotiates with strategic investors about a financial lifeline.

Tritium’s annual general meeting in Brisbane on Thursday heard that the factory, employing about 400 people in suburban Murarrie, will shut on December 22 as it prepares to move all its manufacturing operations to the US.

The company, which will retain a substantial research and development business in Brisbane, did not disclose how many workers will lose their jobs on the eve of Christmas.

The media was banned from attending the annual meeting that was held behind locked security gates at its state-of-the-art Brisbane headquarters.

Shareholders who attended told The Australian that the company confirmed it was talking to “several strategic groups” about investment but did not disclose their identity.

Richlister Brian Flannery, who owns about 5 per cent of Tritium, acknowledged there had been speculation Taiwan group Lite-On Technology would take a stake but Tritium did not confirm this at the meeting. “There has been a lot of hearsay about Lite On but the company did not name anyone,” Mr Flannery. “I am aware Lite-On are a big group.”

Tritium’s Nasdaq-listed shares have sunk almost 90 per cent so far this year. with disappointed shareholders at the Thursday’s AGM remaining hopeful of a turnaround soon.

Anthony Albanese visits Tritium during the federal election campaign.

Mr Flannery said that after attending the meeting, he believed Tritium may “have turned a corner” with good sales and improving margins but there was still a lot of work to do.

“They really need to work hard on (reducing costs) and maybe pause R & D for a while,” said Mr Flannery. “They are going to need a gross margin of 10 to 12 per cent and they are not there yet.” He said the move to shift manufacturing to a new factory in the US state of Tennessee would help reduce overheads.

“Manufacturing costs are generally lower in the US,” said Mr Flannery, who earlier said Tritium could not make any money manufacturing in Australia.

The closure of the factory is a blow to the Albanese Government’s industry ambitions with the prime minister making several visits to the site over the past few years to spruik its credentials as a poster child for advanced manufacturing in Australia.

Tritium has in recent weeks announced deals with SSA Terminals at the Port of Long Beach in California and the National Library of Wales for the installation of chargers. Tritium has racked up almost $190m in losses in the past year to expand its huge factory in Tennessee, but at the same time incurred costly overheads in keeping its Brisbane factory operational.

Tritium, founded in 2001 by engineers David Finn, James Kennedy and Paul Sernia, has won deals with BP and Shell, among others, to supply fast-­chargers across the world.

But it has conceded its operating model has risks in a fast-changing market. Tritium has so far focused exclusively on developing public DC fast-charging stations as well as charging stations for government and corporate fleets.

However, many of its competitors offer cheaper home-based AC charging equipment, which may in the long run reduce demand for Tritium’s public charging stations.

Another competitive threat comes from EV giant Tesla, which has a large public DC charging network in the US using its North American Charging Standard (NACS). Tritium posted a loss of $US120.3m last financial year with net liabilities of $US134m, sparking a warning from auditor PwC that there was significant doubt about the company’s ability to continue as a going concern.In a financial report lodged with ASIC, PwC said Tritium had sought a number of waivers from its financiers after failing to meet requirements for minimum cash liquidity.