PowerSki International Corporation (PSI) could not move into mass production without first lowering the cost of goods to ensure profitability per unit, for the future. Until now, the cost of producing each board was higher then they where sold for. Every aspect of the patented PowerSki Jetboard™ Igniter 330™ has been carefully reviewed with respect to large scale manufacturing and delivery. Close attention was paid to reliability, performance, cost, safety, esthetics, and producibility. This daunting task was not only challenging and rewarding, but also absolutely necessary. Leo Greene, VP of Engineering states, “By establishing a fully defined virtual definition of every component, PowerSki has been able to contract with top notch venders and suppliers who, in turn, can provide concrete delivery schedules for parts at very low prices.” The benefit of doing this is obvious.
To date, PowerSki has shipped worldwide, approximately, 130 PowerSki Jetboard™ units. Due to low-rate production tooling, and the high price of small quantity piece parts, these early units cost PowerSki, approximately, $12K to $15k each. This month, PowerSki will be receiving the first Die Cast engines of the 12,000 engines on order from Daesung Fine Tec. Die Casting is a high-rate production tooling process that lowers the cost of production. PowerSki has lowered the cost of goods for all the unit's components using three factors; high-rate production tooling, large quantity purchasing, and lowered labor costs. These three factors allow PowerSki International Corporation to move into mass production with a potential profit in each new PowerSki Jetboard™ produced.
Latest Technical Updates:
- Main Case
- Delivery of first High Rate Snorkel Part
- 250,000 Series Catalytic Converter™
- PowerSki International's Corp's Relationship with AquaXtremes XBoard
Main Case:
Arriving today are pictures of the first Die Cast Main Case for the patented Supertorque XT™ Marine Engine.
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PowerSki International would have liked to simply purchase an engine rather than to create one from scratch. As it turns out, there has never been another engine in the world that can produce up to 50hp inside 7” of height. This unique, and patented, engine is likely to create a significant revenue stream for PowerSki by itself, as well as push Jetboard production to the level that we have all anticipated. |
Here are just some of the examples of the Die Cast Parts from Daesung Fine Tec.
These are the recently received Die Cast parts from Deasung Fine Tec to the PowerSki Headquarters in San Clemente.
PowerSki took each one of the Die Cast Engine case components to check for proper tolerances. Though these parts have not yet been machined, they still look great. One of the additional checks the PowerSki's Production Team did was to actually weigh each part. There is a 4 lbs difference between the Sand Cast Engine Components and the new Die Cast components.
Delivery of first High Rate Snorkel Part:
 One of the many unique parts of the PowerSki Jetboard™ Igniter 330™ is the High-Surf Air Intake Snorkel (pat. pend.) This part provides two important functions. The first is to stop water ingestion into the board cavity while at the same time allowing the engine to breath. Secondly, it adds a sporty and stylish appearance to the board's design as a whole.
  Dynamic Rubber, Rolling Meadows, IL, did an outstanding job with this elaborate part. They paid about $65k to develop the injection mold tooling for this part alone. This cost will be amortized over the first 1200 snorkels ordered by PowerSki. Up to this point, PowerSki was creating these snorkels using a Rapid Prototype method at a cost of over $300 per snorkel, and shipping them with every new production board. Now, PowerSki will be paying a fraction of that amount helping PowerSki's ramp up to mass production.
PowerSki's 250,000 Series Catalytic Converter™ Update:
PSI's SupertorqueXT™ Marine Engine is set up at Automotive Testing & Development Services (ATDS) in Ontario, Ca., it was determined that their connecting drive shaft was improperly secured. To fix this, a new connection was designed then fabricated. This took three weeks, but is now complete. In addition, the patent pending catalytic converter was moved to its proper position next to the cylinder, which allows it to heat up quicker for a cleaner burn. PowerSki had to design a temporary exhaust manifold, and modify the header pipe to secure the catalytic converter in this correct position. In addition, ATDS routinely uses their dyno for automobiles and not for small marine engines. To mount the Patented SuperTorqueXT™ Marine Engine to their dyno, it was determined that a torque converter was required. A torque converter routinely used in this condition. The fabrication of this adapter is currently under way.
PowerSki International's Corp's Relationship with AquaXtremes XBoard:
In May, 2003, PowerSki signed a Memorandum of Intent to perform a reverse merger into a public company called Nova Communications, Ltd. PowerSki and Nova entered into a later Memorandum of Understanding prior to signing a definitive agreement for an estimated $8.5 million use of proceeds for R&D and mass production requirements. One of the conditions stipulated by this Memorandum included an interim $2 million in bridge loans by Nova to PowerSki. After providing approximately $850,000 in small increments, Powerski is informed and believes that Nova defaulted in March of 2004. Under the terms of the Memorandum, PowerSki must repay one-half that amount, plus interest, at the end of a 36 month period, and provide Nova a distribution opportunity for an available country to be determined.
In the last quarter of '03 PowerSki International Corp. entered into a limited manufacturing agreement with PatX, a subsidiary of the Hines Group and a Mexican manufacturer, for mass production assembly of the patented PowerSki Jetboard™ Igniter 330™. PowerSki supplied all the necessary specifications to assemble our patented PowerSki Jetboard™. Powerski is informed and believes that they also defaulted.
Subsequently in the last quarter of '04, Nova announced that they purchased the majority interest in a Nevada company called AquaXtremes. In the same announcement, NOVA claimed that AquaXtremes is a four year old company that developed a competing motorized surfboard called the Xboard. In another press release, soon thereafter, NOVA announced that the Hines group/PatX agreed to manufacture this new XBoard. Powerski is informed and believes that NOVA Communications , Ltd., The Hines Group, PatX , and others are in violation of the Non-Disclosure/Non-Compete proprietary information agreements that they each have signed. Most of the suspected individuals involved, including a number of former PowerSki employees, have been or are in the process of being served with Cease and Desist letters.
Additionally, our corporate counsel, litigation attorneys and investigators have been researching, analyzing and documenting the situation over the past two years. They are currently preparing an appropriate response to resolve all outstanding issues with all parties involved. |
