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Purolator Courier Ltd. orders 115 Azure hybrid electric vehicles

17 September 2005

Azure Dynamics Corporation (TSX - AZD &
LSE - ADC) ("Azure Dynamics" or the "Company") a leading developer of hybrid
electric and electric powertrains for commercial and military vehicles is
pleased to announce that Purolator Courier Ltd. ("Purolator"), Canada's
largest courier company, has executed an order to purchase 115 new hybrid
electric vehicles.
The order placed by Purolator marks a significant move forward regarding
Purolator's commitment to replace its urban courier vans with environmentally
sensitive vehicles. In September 2003, Azure Dynamics and Purolator signed a
supply agreement for the replacement of up to 2,000 conventional powered
vehicles with Azure powered hybrid electric vehicle technology. The order now
placed by Purolator represents the first commercial production vehicles to be
produced by Azure under that agreement and comes after a period of extensive
pre-production testing by both Purolator and Azure of Purolator vans outfitted
with Azure powertrain technology. Deliveries of the first vehicles will
commence in 2006. Azure continues to advance it's product through various test
prototypes to preproduction vehicles. Ultimately, Azure intends to offer a
full range of series and parallel hybrids.
Campbell Deacon, CEO of Azure Dynamics said, "The 115 hybrid electric
vehicle order is the largest of its kind in the delivery industry. We are
proud to be associated with Purolator and believe their bold leadership will
be instrumental in changing the way the industry does business. Azure will
continue to work to achieve and exceed the performance standards necessary for
Purolator and others to make such ground breaking orders."
Robert Johnson, President and CEO of Purolator remarked, "Given
commercial realities, Purolator is committed to doing what it can to have a
positive impact on the environment. We are pleased that the technology
continues to perform at the high standards we need to see in order to maintain
our excellent delivery performance for our customers. It gives us the
confidence to embark on the next phase of fleet replacement with Azure's
hybrid electric vehicle technology."

About Purolator
---------------
As Canada's largest courier company, Purolator Courier Ltd. of
Mississauga, Ontario is committed to its customers. From automated solutions
to 24 hour pick up and delivery, Purolator provides customers with the
services and customized solutions required to get their shipments across town
or around the world. Purolator operates Canada's largest dedicated air express
fleet. Purolator has an extensive service network, with over 11,500 employees,
including more than 3,500 couriers, over 140 operations locations, over 155
Shipping Centres, over 550 Authorized Shipping Agents and more than 420 drop
boxes. Purolator processes over 5.5 million pieces (delivery and pick up) each
week for destinations across Canada and around the world. Purolator is
committed to helping alleviate hunger in Canada, and works closely with the
Canadian Association of Food Banks to support local communities. For more
information please visit the company website at www.purolator.com.

Azure Dynamics Corporation is a world leader in the development and
production of hybrid electric and electric commercial and military vehicles
and systems. The group estimates it has over 25 million miles of vehicle
experience. Azure Dynamics' operations are based in North America and Europe.
Azure Dynamics is currently working internationally with various partners
and customers including Purolator Courier Ltd., Canada Post, US Department of
Defense, United States Postal Service, SEV Group Limited, Leyland Product
Development and London Taxis International. Azure Dynamics Corporation is a
public company trading on the TSX (AZD) in Canada and on AIM (ADC) in the UK.
For more company information please visit www.azuredynamics.com.

The TSX Exchange does not accept responsibility for the adequacy or
accuracy of this release.

For further information: contact: Steven Glaser, Vice-President,
Corporate Affairs, (416) 367-0220 x105, Email: sglaser@azuredynamics.com