HP2g LLC of Napoleon, which designed the HP2g hybrid engine, is terminating its agreement with Revenge Design, Inc. for the establishment and operation of HP2g certified installation and service center franchises in the U.S.

“We have to move forward with setting up certified installation and service centers in Northwest Ohio and Southeast Michigan because we have people who want our engine in their vehicles,” said Doug Pelmear, CEO of HP2g and inventor of the technology for the engine that could get 110 miles per gallon.

Pelmear informed Peter Collorafi, president and CEO of Revenge Designs in Decatur, Ind., of his intention to move in another direction due to the lack of response to various memos and letters of intent regarding the agreement.

Under the terms executed more than a year ago, Revenge Designs was to become the principal franchisor of all HP2g installation and service center franchises in the U.S. Pelmear said that HP2g now intends to act as its own franchisor for all installation and service centers worldwide. He declined to comment on plans for any installation or service facilities in Ohio and Michigan.

“He’s caught up in getting his car off the ground,” Pelmear said about Collorafi and his lack of action regarding the franchise agreement.

Pelmear said the termination of the franchise agreement should not affect plans to use his HP2g engine in the Verde Super Car that Revenge Designs is developing for sale to consumers. The vehicle was introduced at the International Auto Show in Los Angeles in December, according to previous reports.

Collorafi said that he was not surprised by Pelmear’s notice regarding the termination of the franchise agreement as it has been forthcoming for some time.

“He couldn’t deliver the plans for the engine so we had to consider other options,” Collorafi said.

Revenge Designs announced its withdrawal of all support and funding to HP2g on May 12 due to numerous requests for third party validations to the claims of its 110 MPG hybrid engine. The company received no response to its requests for documentation, Collorafi said.

Pelmear reported that he intends to file for international patents on the technology for the HP2g engine on May 14. Collorafi said they were informed by Pelmear that the patents were in place in late 2009.

Collorafi reported that Revenge Designs will proceed with plans to produce muscle cars with the fuel-efficient GM 638-hp engine and Ford’s super-charged 605-hp engine that get about 30 mpg.

He said Pelmear’s hybrid engine was the third option for them.

Pelmear said that he is working with the U.S. Department of Energy to apply for a grant that would help fund the startup of a facility to manufacture the HP2g engine.

Pelmear and Collorafi met with officials from the Regional Growth Partnership (RGP), Rocket Ventures and potential investors in Toledo earlier this year. But Pelmear was unwilling to share the technology for his HP2g engine at that time.

Investors are reluctant to invest in something unless they have some details about the product or technology in which they are investing, according to Greg Knudson of Rocket Ventures and RGP.

Collorafi wanted to thank the Henry County Commissioners, officials from the Regional Growth Partnership, Rocket Ventures and the Ohio Department of Development for their efforts to find funding for a facility in Ohio. He said they were told funding was not available this year.

Collorafi said they are talking to other states, including Michigan and Indiana about funding for a facility to develop and produce the vehicles by Revenge Designs. The company is in the process of securing the extensive funds, reported around $100 million, needed for the project.

Tags: alternative energy

This entry was posted on Thursday, May 13th, 2010 at 5:09 pm and is filed under Entrepreneurs, Wheels.
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