Orbital Engine Corporation (NYSE: OE) and Saab Automobiles AB have formally established a technology alliance directed at the industrialisation and commercial release of Saab engines using Orbital's direct fuel injection technology.

Saab Automotive is a wholly-owned subsidiary of General Motors and is a leader in providing its customers world-wide with innovative environmentally sensitive technologies. General Motors has been a licensee of Orbital since 1989.

Orbital's direct fuel injection systems substantially boosts the efficiency of gasoline internal combustion engines, by reducing exhaust emissions and improving fuel economy.

Orbital CEO Kim Schlunke said the Saab agreement significantly added to the momentum Orbital was achieving in the commercial development of its direct fuel injection systems.

"In the marine and motorcycle markets, manufacturers are already using Orbital technology on production engines, and we anticipate further product launches over the coming 12 months.

"I am confident that we will achieve similar levels of success in the worldwide automotive market, in partnership with leading companies like Saab."

The benefits of applying Orbital technology to conventional four-stroke automotive engines have been consistently demonstrated by a number of test vehicles developed independently at Orbital.

Independent testing has verified the ability of the vehicle to achieve the strict European Stage 4 emission limits, due to apply in the year 2005, while also achieving a 13% improvement in fuel economy over an identical vehicle fitted with a conventional fuel injection system. Importantly, the test vehicle has been able to achieve these results using a catalyst system significantly cheaper than those required by competing direct injection systems.

Saab is headquartered in Sweden, and is active in more than 50 countries worldwide. It has more than 10,000 employees and sold 131,000 vehicles in 1999.

Orbital is a leading international developer of engine technologies using direct in-cylinder fuel injection and lean-burn systems for enhanced fuel economy and lower emissions. The company serves the worldwide automotive, marine, recreational and motorcycle markets. Headquartered in Perth, Western Australia, Orbital stock is traded on the Australian Stock Exchange (OEC), the New York Stock Exchange (OE) as well as the Berlin (ORE) and Frankfurt (OREA) Exchanges.