The future of Smith Electric Vehicles is in doubt as it attempts to raise vital funds through a share offering on the US stock market.

The company, which started as a builder of electric delivery vehicles in Newcastle in the 1920s and still has a manufacturing facility in the area, is now based in Kansas City after a US buyout in 2010.

It counts Coca-Cola, Staples, Fedex, Sainsbury’s and Gateshead Council among its customers for its electric vans, which include the Ford Transit-based Smith Edison.

Sainsbury’s operates electric fridge van versions for home deliveries within the M25.

Smith, which was reformed following the buyout, has yet to turn a profit – not unusual for a start-up. But it lost $52.5 million (£33.5m) last year and an amendment to its filing with the United States Securities and Exchange Commission in May raises serious questions about its future.

The filing cited a report from an accountancy firm containing an explanatory paragraph that said “recurring losses from operations, negative working capital, and stockholders’ capital deficiency, and the uncertainty around our ability to raise sufficient capital, raise substantial doubt about our ability to continue as a going concern”.

Its Smith Edison electric van was given approved status for the UK’s plug-in van grant in February, but even with the offer of £8,000 of Government subsidy, the company can’t escape its mounting losses.

In the first three months of 2012, the company built 43 vehicles, achieving sales of $6.135m (£3.92m) at an average selling price of $141,860 (£90,578) per vehicle.

However, the average build price is more than $336,000 (£214,000), equating to Smith making a loss of around $194,000 (£124,000) for every vehicle it sold.

Cause for concern, but the actual loss per vehicle is much higher – a staggering $356,744 (£227,781) – after additional operating costs such as R&D, sales, marketing and administrative/back office functions are factored in.

Last year, the company fared slightly better building 270 vehicles while achieving sales of $39m (£24.9m), making a loss of $66,677 (£42,573) for every vehicle it sold.

Revenues have grown since 2009, but so have the losses. Smith reported net losses of $17.5m (£11.17m) in 2009; $30.3m (£19.35m) in 2010; $52.5m (£33.52m) in 2011; and $15.3m (£9.77m) in the first quarter of 2012.

The figures suggest it is on track to make losses of around $40m in 2012, but this is a company that only had $7.4m (£4.72m) net cash at the end of March 2012 and owed its supply chain $16.1m (£10.28m).

Plans to cut operating costs by up to 30%

The good news is that Smith has a plan. The manufacturer says it is working to reduce its material, operating and production costs by up to 30%.

And it enjoys strong backing from customers. Gateshead Council purchased 10 Smith electric vans in September 2010 and fleet manager Graham Telfer praised the support he has received from the manufacturer. “We have had no problems and the service has been exceptional,” he said.

However, he recognised that the initial high cost of electric vehicles was putting off other fleets from choosing them over their diesel counterparts. “Government support is crucial to make them viable,” he added.

Even if Smith hits its saving targets it could still incur losses of around $80,000 (£51,000) for each vehicle it produces.

Meanwhile, investor interest appears to be on the wane. In March 2011, Smith issued a $40m (£25.5m) share placing – it was fully subscribed by the end of that same month, according to Q1 2011 accounts.

However, a $25m (£16m) placing in February 2012 had by end of March 2012 raised only $13.9m (£8.9m) net of fees. The investors are not so eager.

Smith’s difficulties come just over a year after electric van maker Modec ceased trading after administrators failed to find a buyer for the Coventry-based firm.

It announced it was to enter administration in March 2011, with its most recent accounts for the year to December 31, 2009, showing a pre-tax loss of £5.9m.

Smith declined to discuss its financial position, while the SMMT said it did not comment on its members’ financials.