The British government is granting Morgan $8.5 million to develop electrified powetrains

England-based Morgan Motors is out to prove it’s not as old-fashioned as it might seem by developing a handful of electric and hybrid models.

Backed by the British government, Morgan is injecting £6 million (a figure that represents about $8.5 million) into its Malvern, England, factory in order to develop clean drive trains with input from two UK-based firms, Delta Motorsport and Potenza Technology. The money will primarily be used to expand the company’s research and development department, to hire new workers, and to boost its annual production capacity.

Morgan’s managing director, Steve Morris, explains the firm is adopting electrification to significantly reduce its fleet-wide CO2 emissions and to improve its cars’ gas mileage. Ultimately, going green will also help Morgan sell more cars annually, and it might enable the firm to outgrow its niche status by earning a bigger slice of lucrative markets such as China and the United States.

The first regular-production electric model in Morgan’s illustrious, 106-year history will be the production version of the 3-Wheeler-based EV3 concept (pictured) that was shown last summer at the Goodwood Festival of Speed. Set to go on sale before the end of the year, the experimental concept uses a small electric motor that zaps the lone rear wheel with 101 horsepower. It briskly reaches 60 mph from a stop in a little over six seconds, and it goes on to a top speed of about 155 mph.

The British car maker explains that the electric motor is much lighter than the gasoline-burning V-twin engine that usually powers the 3-Wheeler, which helps offset the weight added by the bulky battery pack. All told, the 1,212-pound electric 3-Wheeler has a total driving range of about 150 miles, and topping up the pack takes approximately four hours.

The EV3’s drive train was developed in-house, well before the British government awarded its £6 million grant. Morgan’s next-generation electrified power trains aren’t expected to hit the market until 2019 at the earliest, meaning the EV3 will be the only eco-friendly member of the car maker’s lineup for the foreseeable future.