Auto LPG component supplier AFI in receivership

Alternative Fuels Innovations (AFI), one of the country's largest auto LPG component manufacturers, received the $3.54 million grant in January to develop an LPG liquid injection system. By March, the company was in the hands of receivers.

The company and its receivers, McGrath Nicol, are silent on the matter beyond statements of reassurance that the company continues to trade while formal requests go out for expressions of interest for the business and its assets.

In a brief statement released by McGrath Nicol, receiver and manager Keith Crawford said "our objective is to work constructively with stakeholders to stabilise and prepare the business for sale. In the meantime AFI and [subsidiary] APA will continue trading and we look forward to continued support from employees, customers and suppliers." 

Among its attractions are component supply contracts with Ford and Holden for their LPG product. AFI supplies the fuel tanks for Ford's next-generation EcoLPi liquid injection LPG Falcon, set for release mid-year. Asked if AFI's receivership affects its release in any way, Ford spokeswoman Sinead McAlary told Carsales Network the schedule remains on track and AFI remains in place as the supplier of the tank.

Holden spokeswoman Emily Perry says AFI is slated among suppliers for future product to be announced later in the year. AFI remains a part of the program, she said.

The company's listing among GCIF recipients states the grant is for the development and marketing of "an Australian designed and locally manufactured range of LPG Liquajet Liquid Injection systems". It describes Liquajet as "the new game changing technology that:
- Reduces greenhouse gases and reduces CO2 emissions relative to petrol powered engines in excess of 10 per cent.
- Reduces fuel costs in excess of 50 per cent.
- Delivers superior performance.
- Delivers innovation, employment and sustainability."

Approached about how AFI's troubles will affect its Green Car Innovation Fund grant, a spokeswoman from Minister for Innovation Senator Kim Carr's office told Carsales Network that AusIndustry (the division overseeing the government's innovation, industry, science and research program) is "working closely with the Receiver and Manager of AFI through the insolvency".

GCIF grants are paid in select instalments as the recipient reaches milestones specified up front in their contract. "Should AFI continue to meet their milestones, future instalments will be paid," she said.

"While specific details of  individual grant contracts are commercial-in-confidence, AusIndustry requires all recipients are required to report quarterly on the progress of their GCIF projects and eligible expenditures they incur as they go," she said. "Payments are made based on progress against milestones and the value of eligible expenditure they incur."

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