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I have an engine kit I bought a while ago, but, I haven't gotten to it yet, so no specific expertise, .... but I do have some skill at problem solving, so I'll jump in.
It looks to me like the KILL switch (is it actually a momentary acting button, or is it a switch) must short the Yellow to the Green, If these are hooked up to the Blue and Black as shown, that would short Blue to Black, i.e. short Blue to ground.
And, it appears that the Optional method, with the dotted Yellow line is to short White via dotted Yellow to Green to Black to ground, so I'd assume that White goes to Blue inside the engine?
And, I'd assume that Blue / White comes from some sort of generator coil inside the engine? What sort of pulse voltage & power is expected on Blue over Black? This really seems like it's more of a Magneto type ignition, than a CDI type to me.
If there is no kill switch, it seems like a only a few things could be wrong.
- Weak permanent magnet inside engine, producing insufficient power
- Power is being dissipated on it's way to the CDI. Shorted or low resistance to ground on Blue or White
- Bad CDI
- Black CDI primary wire is not grounded
- High resistance on High voltage lead to spark plug
- Spark plug is gapped too wide or internally open, or too high of resistance.
- Engine is not grounded
How is your White wire terminated?