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Gevo Biofuel Sees Growth on Ford, Coke Ties

NEW YORK ( TheStreet) -- Shares of thinly followed small-cap biofuel company Gevo (GEVO - Get Report) have been in the spotlight thanks to its partnership with Coca-Cola (KO) and a new use of technology by Ford Motor (F).

Gevo's technology centers around renewable chemical and biofuels. Specifically, Gevo produces isobutanol from renewable sources. Gevo gives ethanol producers an opportunity to increase their margins through its technology. Gevo's ethanol and isobutanol produced can be bought at lower costs by customers like airlines and plastic container users. Isobutanol is a renewable fuel that can be turned into jet fuel and plastic through chemical processes.

Production is currently in the early stages for Gevo, saying it plans to expand production capacity to produce and sell over 350 million gallons per year of isobutanol by 2015. In June, the company resumed production of isobutanol at its Luverne, Minn., plant and is preparing to ramp up production for 2014. The Luverne plant currently produces 22 million gallons per year of ethanol and an additional 18 million gallons of isobutanol.

Back in 2011, Gevo announced a joint partnership with Coca-Cola to improve the beverage company's packaging. Coca-Cola's PlantBottle packaging is the first ever recyclable plastic bottle made partially from plants. Now, with Gevo, Coca-Cola is on its way to producing a 100% plant-based bottle using renewable para-xylene. Coke launched the plant bottle technology in 2009. Since that time, over 18 billion bottles in 28 countries have been sold in this plant based bottle.

Ford's use of Gevo technology was big news for the company. Ford is essentially using the Gevo technology used by Coca-Cola to improve the interior of its automobiles. The technology is being used as part of the interior fabric on the new Ford Fusion Energi Plug-In car. The polyethylene terephthalate, or PET for short, packaging will be used for seat cushions, seat backs, head restraints and door panel inserts. The new Ford Fusion Energi Plug-In hybrid car was recently displayed at the Los Angeles Auto Show. The Fusion Energi is the most fuel-efficient car Ford has ever produced and the interior of the car will now also use less oil with Gevos help. If all Ford model interiors used the Plant Bottle technology, it would save 295,000 gallons of gasoline and 6,000 barrels of oil, according to Gevo.
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