ZAP (fka ZAAP)

[WOLDUMAR]

ZAP Jonway (OTC:ZAAP) On the Road Down the Hill Again
http://www.hotstocked.com/article/5202/zap-jonway-otc-zaap-on-the-road-down-the-hill.html
By Petar Ilievski
Date: Apr 19, 2011
Finally merged, the hype is over, and ZAP Jonway (OTC:ZAAP, ZAAP message board) stock slowly and methodically declines day after day. At least, ZAP managed to show people that the company is indeed capable of producing EV vehicles, and it is not all press releases and uncertain claims. What comes next, however, is more interesting.
After the glorious rise associated with the acquisition of Chinese Jonway Automobile, supported by lots of promotions, shareholders are now looking for the benefits to come. For one reason or another, however, the stock declines steadily and has lost more than 50% of its value since January. Yesterday was no exception with another 8% decrease for the day, opening at $0.7 per share and closing at $0.68 with a trading volume around 420k. In terms, the last 10-K that came out on Friday was also not the inspiring source of information shareholders might be looking for.

There are revenues, the total current assets surpass liabilities, yet the net loss is still a major problem, and so is the mounting accumulated deficit. The fact of the matter is, though, that the next quarterly statements should be much more important, since they could eventually prove the benefit of the merger mentioned above. In terms, they could validate all the press release claims from ZAP over the past few months.

In 2008, people who were looking for additional information about ZAP would find lots of negative comments about it on the Internet, especially about the vehicles that would only remain on paper. Obviously, bringing out the Alias, A380 etc to the market smashed the critics on that point. There are a few other challenges at hand, however.


One of them is competition. ZAP is by far not the only company focusing on zero emission electric vehicles. One does not have to be an industry specialist, since just a quick search on google for "new electric vehicles" would present a good idea about the market ZAP is trying to position on.

Yet, hard competition means something else, as well - that there is demand for the type of products; thus, money to be made. Furthermore, merging with a Chinese enterprise means also that the products of the two enterprises can now set foot on both continents. And since both China and US are taking steps to support companies like ZAP either directly, or through various initiatives to reduce emissions, it is a broad field to explore. Whether ZAP would be one of the winners in this competition, however, is still a question of uncertainty.