Today Fuel Systems Solutions (NASDAQ:FSYS) was selected by General Motors (NYSE:GM) as a Tier-One supplier for a new compressed natural gas (CNG) bi-fuel commercial pickup truck. The company is already integrating its bi-fuel systems into the Chevy Express and GMC Savana cargo vans at its facility in Indiana and will add this new CNG pickup from GM into the mix. The vehicle is expected to launch in about a year.
Matthew Beale, Fuel Systems’ Co-President, said, "The announcement of GM’s bi-fuel pick-up truck is highly significant on several levels. In general, broader availability of OEM vehicles equipped to operate on CNG will drive adoption and growth in the North American market. More importantly, the bi-fuel technology has the potential to expand the addressable market as it provides a solution to the "range anxiety" associated with limited compressed natural gas refueling infrastructure. With this announcement of a fully integrated OEM CNG bi-fuel solution – a market milestone – our IMPCO Automotive business has established itself as a technology leader in the fast evolving North American alternative fuels market."
This is good news for shareholders of FSYS which have seen the stock begin to stabilize after a year long downtrend. It’s currently trading above the 50 day moving average and the 2011 lows appear to be a long term support area. The key now is for the stock to maintain what is now new support above the 50 around the $20/share level. FSYS reports earnings before the bell Nov 9th.