RE:RE:One Month (or less) until RegsThere's no way they will remove the 2 year field service trial because it's a regulated industry. The only event that could potentially occur is that trial length is decreased or they switch to a miles traveled basis (ex: the component needs to complete X amount of miles on a tanker car without any incidents to get approved). The latter is already happening with Kelso's BOV and VRV. It's my understanding that this is just the case for Kelso for the time being. If you look in the filing statement, it clearly states that BOV and VRV field service trials will start later in 2015, but will be commercially available in 2016. Either way, the field service trial is only a small part of the high barrier to entry in this business. As I've stated in numerous other posts, a) the industry is regulated so change is dreadfully slow (manway and PRV designs haven't changed in decades) b) there's a small number of OEMs who only like to deal with familiar companies (Kelso is now one of those after 20 years!) c) independent testing needs to be done d) need to get AAR vendor status e) be well capitalized to afford pay hefty product liability insurance premiums and build assembly plants f) it takes significant time to develop superior products. And there's more...
I think what most people are missing is that even if the patent expires there's absolutely no reason to be worried. You see, Kelso will bundle all their products together to offer discounts to OEMs and simplify the ordering of tanker car components (less parts to order from multiple companies). So if the patent expires on one of their products and all the others still have their patents and you factor in the exceptionally high barriers to entry that this business has for the aforementioned reasons, you quickly realize there is no material reason to worry.