Q — Talk about how Synergyn fuel additive is different than previous products claiming to increase gas mileage.
A — The FTC, EPA and DOE just put out a memo in August saying they’ve looked at all the additives on the market and none of them have improved mileage, other than some of them are detergents. If you’ve got a dirty engine and you clean out the fuel systems, you’ll improve the mileage. That’s what Chevron’s Techron does. That’s what some of the other things do. That’s a valid use.
None of them do what d-limonene (orange oil) does – that’s carbon 10, hydrogen 16. When you take oranges and squeeze out the juice, you get the rinds, you get d-limonene and you get orange juice concentrate.
That d-limonene becomes the orange oil in your household orangey cleaners. Or if you’ve seen that flaming drink in Louisiana, they squeeze an orange rind, you get a puff of oil coming out of it across the flame, and you get a puff of flame. That is d-limonene. What happens is, at high temperature before a combustion event, it splits into isoprene – carbon 5, hydrogen 8. That releases heat… And then isoprene is very explosive, so in a fuel chamber it splits, burns into carbon dioxide and water.
Now, that two-stage process – if you put it into the fuel mix. … By putting less than one percent of d-limonene and a couple other secret ingredients into your fuel charge, that two-stage combustion process happens just before the main combustion event in a diesel engine.
A lot of people have seen that bar trick, but nobody thought about putting it in fuel before.
Q — What’s the schedule for roll-out?
A — We’re testing in a number of fleets. This spring we’ll launch (subject to funding, of course) in the big box stores. Our management team has done 10 similar launches of engine-treatment fuel additives. They have put the product in 5,000 to 10,000 big box stores in six to 12 months. With the funding we’ll do that again.
Jim Scott, who’s the chairman, (led marketing for) a company called Slick 50 … that has Teflon in it. That approved lubricity and mileage by about 5 percent, so it was a small improvement.
Q — Synergyn is both a “green” and money-saving product, right?
A — Synergyn is green. By saving fuel, it’s an energy-dependence issue. It’s a carbon-dioxide issue. And you’re actually saving money. For a Prius, you have to spend money to save money. With this, you can either break even or save money.
Synergyn products are actually tested with NASA scientists. We’ve done testing to NASA certification protocols. They supervise testing. We’re the only additive that has been awarded a certified space technology designation from the Space Foundation, which was created by NASA.
In testing we’ve gotten more than 30 percent fuel economy improvement in certain vehicles … It’s very vehicle-specific. When tested on a Chrysler and an Acura, we got an improvement of more than 20 percent.
In the city of Houston, garbage trucks right now are interesting because they get about a mile-and-a-half or two miles per gallon. There’s an instance where you could see a lot of improvement … Fleet savings could be tens of millions of dollars a year for a large fleet.
Q — How big is your addressable market?
A — It’s potentially about a $10 billion to $20 billion market. About 168 billion gallons of gas and diesel fuel are used in the United States annually. (Obviously, not everyone would be a customer.)
Q — What if you run out of oranges?
A — Anytime you’re using a product like d-limonene that’s a by-product of something else, you’re constrained by the amount of (the product of origin) — in this case, oranges.
Orange oil is close to as valuable as the orange juice. If this scales and we need more oranges, we’ll probably end up growing oranges in subtropical countries, and orange juice becomes the by-product. Now, what this means is – and this is really cool – oranges grow in areas where often the population is poor and undernourished. So suddenly, we’ve got a high-calorie food that anything we can sell it for is good. And it’s got great micronutrients. So if you’re in a calorie-deficient, nutrient-deficient environment, this would be a perfect development project.
Q — Describe your management team and its marketing strategy?
A — From the investor point of view, if you saw the numbers we expect to put out of this, it would fall in the too-good-to-be-true category. But Jim Scott – our chairman — when he launched Slick 50, he took it from a $2 million company to a $138 million company in three years. He sold it to a private equity firm, cashed out, played golf for awhile. They didn’t understand advertising. The company was then bought by Quaker State. Jim was brought back. Sales had dropped to $56 million. He changed the advertising mix. In 18 months sales were back to $96 million.
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