OAK PARK, MI - Hybrid-electric and electric vehicle powertrain developer Azure Dynamics Corp. announced it has signed a supply agreement with an Indiana company that manufactures commercial step vans and shuttle buses.

The deal with Utilimaster Corp. covers the assembly, hybridization and manufacturing engineering of Azure's P1 hybrid-electric commercial delivery vans and shuttle buses. The vehicles are based on stripped Ford E-Series chassis and Azure's hybrid powertrains and will be assembled at Utilimaster's manufacturing facilities in Wakarusa, Ind.

Azure first signed a memorandum of understanding with Utilimaster in August 2007. "Since then, significant progress has been made by both parties to reach production readiness. We are on track to begin delivery of production Ford E-Series parallel hybrid commercial delivery vehicles to our customers," Scott Harrison, Azure's CEO, said in a statement.

Azure expects its first deliveries of production vehicles to commercial fleet customers including FedEx Express and Purolator Courier Ltd. of Canada during the summer, said Steven Glaser, vice president of corporate affairs. There is no dollar value attached to the supply agreement.

"They have no limit on pumping out these vehicles, we've just got to go out and sell them," Glaser said. "They've got the infrastructure for it, they're a wonderful partner for us." Utilimaster boasts as clients companies like Aramark, the United States Postal Service, and Frito-Lay Inc.