Enova, Navistar in hybrid bus contract

Torrance, Calif.-based Enova Systems (AMEX: ENA) announced today that it signed a long term agreement for the use of its electric drive systems in hybrid school buses built by Warrenville, Ill.'s Navistar International (OTC: NAVZ).

Enova said the contract is worth $120 million through 2010.

Under the agreement, Enova said its post transmission parallel hybrid electric drive system would be used by IC Bus, a unit of Navistar.

"This is a significant milestone for Enova and the entire market," said Mike Staran, president and CEO of Enova.

"We are honoured that a world leading OEM such as IC Corporation has chosen us as their partner to be their production supplier of electric drive systems."

Enova said IC Bus has forecast significant market penetration of its hybrid buses in the U.S., Canada and Mexico, the countries included in the terms of the agreement.

Additionally, Enova said it's working with IC Bus to evaluate the hybrid bus market in India.

"Hybrid buses provide two distinct advantages," said John McKinney, VP and general manager of IC Bus.

"With its reduced fuel use and emissions, it is environmentally friendly. Secondly, a significant increase in fuel efficiency can dramatically improve the bottom line of many businesses."

Enova said its post transmission hybrid drive system is a non-invasive system that requires little or no modification of the chassis, body and instrument panel.

The company said its hybrid drive also does not intrude on the engine control or communication system. Enova said its hybrid drive monitors, but does not impact the diesel engine operating parameters.