Coates International Ltd (OTCMKTS:COTE) recently announced that it has begun manufacturing green combustion engine technology in the US. The assembly line has been set up at the company headquarters in New Jersey. Currently, the assembly line is dedicated to engines and natural gas generators for industrial purposes. Additionally, the company also announced that its first customer would be a Chinese company. Unfortunately, despite the exciting news the stock continues to lose its value.
Coates International focuses on the manufacturing and marketing of a superior, yet environmentally friendly engine. Unfortunately, altering a major part of people’s lives is not easy task. The company’s marketing campaigns have so far been able to get its $50 million worth of orders for the green engine. However, this amount represents only a small number of green engines, when compared to the total vehicles on the road. The slow response from the public is accompanied by hesitation from the investors, who doubt that Coates will be able to make a big impact very soon.
Coates International itself seems to be worried about its products not succeeding, since the company in its press release has claimed that no assurance of success in the projects is anticipated. The problem with focusing on a unique field, which can drastically change the lifestyle of people, is a very risky task. The effects of this are starting to show on the company’s financial reports. In its latest filing, Coates International reported cash of just $72,622, with revenues of just $4,800. On the negative side, the company has a net loss of $2 million. Although the new deal with the Chinese client seems to be a step in the right direction and would give the company some operating cash, but it is highly unlikely that it would be enough. Additionally, Coates International also has a mortgage loan of $1.4 million due next month.
Coates International Ltd (OTCMKTS:COTE) closed at a share value of $0.0058, after declining by 17.14%. A total of 712.91 million COTE shares were traded during the session.
