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Allison Transmission, Inc Corporation and Torotrak

Allison, http://www.allisontransmission.com/index.jsp, leads the world in the design, manufacture and sales of medium- and heavy-duty automatic transmissions. Since March 2009 Allison has owned nine percent of Torotrak, in return for which the company were granted worldwide licence and exclusivity options to commercialize Torotrak's Infinitely Variable Transmissions.

Under that deal Allison paid £2.41m for the 14.6m Torotrak shares and as licence fees paid £4.69m to Torotrak in 2009 and a further £3.75m in 2010. Additionally Allison secured options to purchase at a future date, a non-exclusive licence for large commercial vehicles and a further option to secure worldwide exclusivity (except for Torotrak's other existing licensees in this field) across the commercial vehicle market.

Additional fees payable to Torotrak could amount to a further £6.75m to £17.37m depending upon Allison's decisons relating to the extent and timing of the further rights that it may wish to take up.

Work on producing Allison branded IVTs has been going well with a prototype being produced within the first twelve months of technology transfer from Torotrak to Allison

Allison were due to announce by 31st March, their decision on the next phase of their development of Torotrak's IVT for their own use.

The fact that no announcement came should not worry us. The date was never cast in stone and could turn out to be any time until June. If Allison had decided not to further develop their brand of the IVT they would have said so and the fact that nothing was said means that negotiations are going on with Torotrak about how Allison are going to proceed.

The fact is that Allison need the IVT. They have been losing market share with their existing epicyclic based automatic transmissons to up and coming transmissions like automated dual clutch designs. They need a new technology to leapfrog their competitors which is why they took up with Torotrak in the first place.

Since that work started another possibility has emerged with the realisation that all Allison transmisions have a built in power take-off attachement which is not used in bus and commercial vehicle applications. This power take-off turns out to be ideal for attaching an energy recovery flywheel, such as is being developed by Flybrid in concert with Torotrak. This development is being subsidised by the UK Govt on a Jaguar car but Allison are co-operating in that development at their own cost (being an American company they don't qualify for UK Govt cash).

Putting IVTs in new buses and commercial vehicles will be great but the after market of retrofitting flywheels in buses will potentially be much greater.

We have been told by Torotrak that things are going well with Allison so the announcement when it comes, is bound to be good news.