I have been a long time supporter of this stock. It has been severely sold off since Feb 2001 (about $2.20 to 24 c). It's 2 Stroke fuel injection technology was first used on Mercury's outboards in 1996 and the number of models they are selling with Orbitals technology has been increasing ever since. The engines are brilliant. The number of manufacturers using the technology has also been increasing. In the recreational engine market it includes Bombardier and Tohatsu. Tohatsu engines are being used by Nissan as well on their outboards. Bombardier are using OEC's technology on personal watercraft. OEC's technology is set to save the 2 Stroke engine. Several yrs ago Aprilia (Italy) introduced an OEC equipped 50 cc scooter and it has been going great guns, and Sundiro in China has made 500 OEC equipped 50 cc bikes but they do not seem to have gone any further because Honda went into a JV with them and Honda are committed to 4 Stoke bikes. However, in May Piaggio, the biggest European bike maker, introduced OEC equipped 50 cc scooters. There is a Piaggio brand and a Gillera brand bike. Piaggio took a long time to adopt it because they tried a number of solutions to dodge using OEC's technology and finally gave up on their attempts. Also Taiwan manufacturer, Kimco, is introducing OEC equipped bikes. However, that is all chicken feed. We all await a 4 Stroke auto deal. GM have designed and built a new engine, the XV8, around OEC's air injected fuel injection system. However, as far as we can tell they have made no decision to make them and put them in cars. What we do know is that the other gasoline direct injection systems have failed to deliver what was promised by their manufacturers, and they need low Sulphur fuel. OEC's system delivers with high or low S fuel, and lower cost catalytic converters. We also know that the regulations for emissions standards will continue to tighten. A major downside to OEC is its present financial position. The Company has been around for about 30 yrs. It has no debt, but it will announce a loss of about $25 mill. this yr. Early this yr it replaced the CEO, Kim Schlunke with Peter Cook. Schlunke has now been made redundant along with 34 others. Cook wants to stop cash drain and become neutral cash wise. He should do it next yr, he might even make a small profit. There is a further reason for the downsizing. The nature of the business has changed. In the past OEC would do all the ingineering and send it back to the Auto guys for evaluation. More and more of this kind of work is being done in the Auto's research facilities. The Auto companies (about 10 are licensed to OEC) are trying OEC's technology in various combinations on their products and, if you like, are making OEC's technology "their technology". You will see various names associated with OEC's 2 S technology - Optimax, Ditech, Pure jet, TLDSI, etc. If OEC's technology is adopted by a 4 Stroke auto, (SAAB have already said they will use it - but when?) Delphi are now a licensee (since August 2002) and are promoting the product to Auto makers, then the price will spike like you ain't seen nothing yet. At least that is my expectation.
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