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| Delaware                                                                                     | 04-2985631                                                         |
|----------------------------------------------------------------------------------------------|--------------------------------------------------------------------|
| (State                or other jurisdiction                of incorporation or organization) | (I.R.S.                Employer                Identification No.) |

| (Title                of Each Class)                                 | (Name                of Exchange on Which Registered) |
|----------------------------------------------------------------------|-------------------------------------------------------|
| COMMON                STOCK, PAR VALUE $.10                PER SHARE | AMERICAN                STOCK                EXCHANGE |

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| ITEM                                                                                                                                                                                   | PAGE     |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------|
| PART                I                                                                                                                                                                  |     |
| 1. BUSINESS                                                                                                                                                                       |     |
| General                description                                                                                                                                                     | 3        |
| Marketing                and sales                                                                                                                                                     | 3        |
| Patents                                                                                                                                                                                | 3        |
| Backlog                                                                                                                                                                                | 3        |
| Raw                materials                                                                                                                                                           | 3        |
| Competition                                                                                                                                                                            | 3        |
| Research                and development                                                                                                                                                | 3        |
| Environmental                regulations                                                                                                                                               | 4        |
| Employees                and labor relations                                                                                                                                           | 4        |
| 1A. RISK                FACTORS                                                                                                                                                   | 4        |
| 1B. UNRESOLVED                STAFF COMMENTS                                                                                                                                      | 5        |
| 2. PROPERTIES                                                                                                                                                                     | 5        |
| 3. LEGAL                PROCEEDINGS                                                                                                                                               | 5        |
| 4. SUBMISSION                OF MATTERS TO A VOTE OF SECURITY HOLDERS                                                                                                             | 5        |
| PART                II                                                                                                                                                                 |     |
| 5. MARKET                FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND                ISSUER                PURCHASES OF EQUITY                SECURITIES |  5  |
| 6. SELECTED                FINANCIAL DATA                                                                                                                                         | 6        |
| 7. MANAGEMENT’S                DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF                OPERATIONS                                                      | 7        |
| 7A. QUANTITATIVE                AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                                                                                     | 13       |
| 8. FINANCIAL                STATEMENTS AND SUPPLEMENTARY DATA                                                                                                                     |     |
| Consolidated                Balance Sheets at September 30, 2007 and                2006                                                                                               | 14       |
| Consolidated                Statements of Income for the Years                ended September 30, 2007, 2006 and 2005                                                                  | 15       |
| Consolidated                Statements of Comprehensive Income                for the Years ended September 30, 2007, 2006 and 2005                                                    | 15       |
| Consolidated                Statements of Stockholders’ Equity                for the Years ended September 30, 2007, 2006 and 2005                                              | 16       |
| Consolidated                Statements of Cash Flows for the Years ended                September 30, 2007, 2006 and 2005                                                              | 17       |
| Notes                to Consolidated Financial                Statements                                                                                                               | 18       |
| Report                of Independent Registered Public Accounting                Firm                                                                                                  | 29       |
| 9. CHANGES                IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL                DISCLOSURE                                                             | 30       |
| 9A. CONTROLS                AND PROCEDURES                                                                                                                                        | 30       |
| 9B. OTHER                INFORMATION                                                                                                                                              | 30       |
| PART                III                                                                                                                                                                |     |
| 10. DIRECTORS,                EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE                                                                                                         | 30       |
| 11. EXECUTIVE                COMPENSATION                                                                                                                                         | 31       |
| 12. SECURITY                OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT, AND RELATED                STOCKHOLDER                  MATTERS                      |  31 |
| 13. CERTAIN                RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR                INDEPENDENCE                                                                       | 31       |
| 14. PRINCIPAL                ACCOUNTING FEES AND SERVICES                                                                                                                         | 31       |
| PART                IV                                                                                                                                                                 |     |
| 15. EXHIBITS,                FINANCIAL STATEMENT SCHEDULES                                                                                                                        |     |
| Exhibits                                                                                                                                                                               | 32       |
| Financial                statements and schedule                                                                                                                                       | 32       |
| SIGNATURES                                                                                                                                                                             | 33       |
| SCHEDULES                                                                                                                                                                              |     |
| II Reserves                                                                                                                                                                       | 36       |

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PART      I

ITEM      1      BUSINESS

General      Description

Marketing      and sales

Patents

Backlog

Raw      materials

Competition

Research      and development

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Environmental

Employees

ITEM      1A RISK      FACTORS

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ITEM      1B      UNRESOLVED STAFF COMMENTS

ITEM      2      PROPERTIES

ITEM      3 LEGAL      PROCEEDINGS

ITEM      4 SUBMISSION      OF MATTERS TO A VOTE OF SECURITY HOLDERS

PART      II

ITEM      5 MARKET      FOR THE REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER      PURCHASES OF EQUITY SECURITIES

|                                                                                           |   |    | Quarter                  1  |   |    | Quarter                  2 |   |    | Quarter                  3 |   |    | Quarter                  4 |   |    | Year      |   |
|-------------------------------------------------------------------------------------------|--------|---------|----------------------------------|--------|---------|----------------------------|--------|---------|----------------------------|--------|---------|----------------------------|--------|---------|-----------|--------|
| 2007                  Quarters                                                            |   |    |                             |   |    |                       |   |    |                       |   |    |                       |   |    |      |   |
| Cash                  dividends per share                                                 |   | $       | .03                              |   | $       | .03                        |   | $       | .03                        |   | $       | .03                        |   | $       | .12       |   |
| Common                  stock price per                  share - High- Low |   | $  | 7.856.61                         |   | $  | 7.946.40                   |   | $  | 11.256.88                  |   | $  | 11.937.80                  |   | $  | 11.936.40 |   |
| 2006                  Quarters                                                            |   |    |                             |   |    |                       |   |    |                       |   |    |                       |   |    |      |   |
| Cash                  dividends per share                                                 |   | $       | .03                              |   | $       | .03                        |   | $       | .03                        |   | $       | .03                        |   | $       | .12       |   |
| Common                  stock price per share - High- Low                  |   | $       | 6.104.95                         |   | $  | 6.555.36                   |   | $  | 7.365.95                   |   | $  | 7.096.20                   |   | $  | 7.364.95  |   |

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|                                                        | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 |
|-------------------------------------------------------------|------|------|------|------|------|------|
| Tech/Ops                Sevcon, Inc.                        | 100  | 138  | 140  | 143  | 172  | 219  |
| AMEX                Market Value Index                      | 100  | 124  | 143  | 173  | 180  | 222  |
| Hemscott                Electric Industrial Apparatus Index | 100  | 133  | 162  | 201  | 255  | 321  |

ITEM      6 SELECTED      FINANCIAL DATA

|                                                     |   |   | 2007   |   |   | 2006   |   |   | 2005   |   |   | 2004   |   |   | 2003   |   |
|----------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Net                  sales                               |   | $      | 39,213 |   | $      | 34,630 |   | $      | 31,675 |   | $      | 29,150 |   | $      | 23,113 |   |
| Operating                  income                        |   |   | 2,063  |   |   | 1,844  |   |   | 999    |   |   | 972    |   |   | 151    |   |
| Net                  income                              |   |   | 1,303  |   |   | 1,114  |   |   | 641    |   |   | 611    |   |   | 83     |   |
| Basic                  income per share                  |   | $      | .41    |   | $      | .35    |   | $      | .21    |   | $      | .20    |   | $      | .03    |   |
| Cash                  dividends per share                |   | $      | .12    |   | $      | .12    |   | $      | .12    |   | $      | .12    |   | $      | .12    |   |
| Average                  shares outstanding              |   |   | 3,167  |   |   | 3,139  |   |   | 3,125  |   |   | 3,125  |   |   | 3,125  |   |
| Pension                  and other long-term liabilities |   |   | 2,305  |   |   | 2,942  |   |   | -      |   |   | -      |   |   | -      |   |
| Stockholders’                  equity              |   |   | 12,434 |   |   | 10,037 |   |   | 10,589 |   |   | 10,464 |   |   | 9,648  |   |
| Total                  assets                            |   | $      | 21,926 |   | $      | 18,652 |   | $      | 16,446 |   | $      | 16,608 |   | $      | 13,784 |   |

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|                                                             |   |   |   |   |   |   |   | (in                thousands of dollars except percentages)  |
|-------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|-------------------------------------------------------------------|
|                                                        |   |   |   |   |   |   |   |                                                              |  %                change due to:  |   |
|                                                        |   |   | 2007   |   |   | 2006   |   |                                                              | Total |   |   | Currency |   |   | Volume                / other |   |
| Sales                                                       |   |   |   |   |   |   |   |                                                              |   |   |   |   |   |   |   |   |
| Controls                - to external customers             |   | $      | 37,009 |   | $      | 32,808 |   |                                                              | 13% |   |   | 6% |   |   | 7% |   |
| Capacitors-                to external customers            |   |   | 2,204  |   |   | 1,822  |   |                                                              | 21% |   |   | 11% |   |   | 10% |   |
| Capacitors                - inter-segment                   |   |   | 52     |   |   | 64     |   |                                                              | -19% |   |   | 7% |   |   | -26% |   |
| Capacitors                - total                           |   |   | 2,256  |   |   | 1,886  |   |                                                              | 20% |   |   | 11% |   |   | 9% |   |
| Total                sales to external customers            |   |   | 39,213 |   |   | 34,630 |   |                                                              | 13% |   |   | 6% |   |   | 7% |   |
| Gross                Profit                                 |   |   |   |   |   |   |   |                                                              |   |   |   |   |   |   |   |   |
| Controls                                                    |   |   | 13,479 |   |   | 12,268 |   |                                                              | 10% |   |   | 2% |   |   | 8% |   |
| Capacitors                                                  |   |   | 869    |   |   | 838    |   |                                                              | 4% |   |   | 9% |   |   | -5% |   |
| Total                                                       |   |   | 14,348 |   |   | 13,106 |   |                                                              | 9% |   |   | 2% |   |   | 7% |   |
| Selling                research and administrative expenses |   |   |   |   |   |   |   |                                                              |   |   |   |   |   |   |   |   |
| Controls                                                    |   |   | 10,810 |   |   | 10,094 |   |                                                              | 7% |   |   | 7% |   |   | 0% |   |
| Capacitors                                                  |   |   | 1,158  |   |   | 770    |   |                                                              | 50% |   |   | 12% |   |   | 38% |   |
| Unallocated                corporate expense                |   |   | 317    |   |   | 398    |   |                                                              | -20% |   |   | 0% |   |   | -20% |   |
| Total                                                       |   |   | 12,285 |   |   | 11,262 |   |                                                              | 9% |   |   | 7% |   |   | 2% |   |
| Operating                income                             |   |   |   |   |   |   |   |                                                              |   |   |   |   |   |   |   |   |
| Controls                                                    |   |   | 2,669  |   |   | 2,174  |   |                                                              | 23% |   |   | -24% |   |   | 47% |   |
| Capacitors                                                  |   |   | (289   | )      |   | 68     |   |                                                              | -525% |   |   | -27% |   |   | -498% |   |
| Unallocated                corporate expense                |   |   | (317   | )      |   | (398   | )      |                                                              | -20% |   |   | 0% |   |   | -20% |   |
| Total                                                       |   |   | 2,063  |   |   | 1,844  |   |                                                              | 12% |   |   | -29% |   |   | 41% |   |
| Other                income and expense                     |   |   | (75    | )      |   | (110   | )      |                                                              | -32% |   |   | -11% |   |   | -21% |   |
| Income                before income taxes                   |   |   | 1,988  |   |   | 1,734  |   |                                                              | 15% |   |   | -30% |   |   | 45% |   |
| Income                taxes                                 |   |   | (685   | )      |   | (620   | )      |                                                              | 10% |   |   | -30% |   |   | 40% |   |
| Net                Income                                   |   | $      | 1,303  |   | $      | 1,114  |   |                                                              | 17% |   |   | -31% |   |   | 48% |   |

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|                                                                   |   |   |        |   | (in                thousands of dollars except percentages)  |
|------------------------------------------------------------------------|--------|--------|-------------|--------|-------------------------------------------------------------------|
|                                                                        |   |   | Sales  |   |                                                              | Cost                of                sales |   |   | Gross                Profit |   |   | Gross                Profit | % |
| Actual                Fiscal 2006                                      |   | $      | 34,630      |   | $                                                                 | 21,524 |   | $ | 13,106 |   |   | 37.8% |   |
| Change                in fiscal 2007 due to:                           |   |   |        |   |                                                              |   |   |   |   |   |   |   |   |
| Foreign                Currency fluctuations                           |   |   | 2,162       |   |                                                              | 1,888 |   |   | 274 |   |   | (1.4%) |   |
| Increased                volume, assuming 2006 gross profit percentage |   |   | 2,421       |   |                                                              | 1,506 |   |   | 915 |   |   | - |   |
| Other                cost of sales changes, net                        |   |   | -           |   |                                                              | (53 | ) |   | 53 |   |   | 0.2% |   |
| Actual                Fiscal 2007                                      |   | $      | 39,213      |   | $                                                                 | 24,865 |   | $ | 14,348 |   |   | 36.6% |   |

| Selling,                research and                administrative expenses                                 |  (in              thousands of dollars) |   |
|-------------------------------------------------------------------------------------------------------------|----------------------------------------------|--------|
| Reported                expense in fiscal 2007                                                         |                                         | $      | 12,285 |   |
| Reported                expense in fiscal 2006                                                              |                                         |   | 11,262 |   |
| Increase                in expense                                                                          |                                         |   | 1,023 |   |
| Increase                (decrease) due to:                                                                  |                                         |   |   |   |
| Effect                of exchange rate changes                                                              |                                         |   | 818 |   |
| Lower                engineering expense, net of currency effect                                            |                                         |   | (67 | ) |
| Decrease                in sales and marketing expense, net of currency effect                              |                                         |   | (243 | ) |
| One-time                cost of management changes in the capacitor business                                |                                         |   | 297 |   |
| Cost                of recruitment and employment of Principal Accounting                Officer            |                                         |   | 200 |   |
| Other                operating expense changes, net                                                         |                                         |   | 18 |   |
| Total                increase in selling research and administrative expenses in fiscal                2007 |                                         | $      | 1,023 |   |

----

|                                                        |   |   |   |   |   |   |   | (in                thousands of dollars except percentages)  |
|-------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|-------------------------------------------------------------------|
|                                                             |   |   |   |   |   |   |   |                                                              |  %                change due to:  |
|                                                        |   |   | 2006   |   |   | 2005   |   |                                                              | Total |   |   | Currency |   |   | Volume                / other |   |
| Sales                                                       |   |   |   |   |   |   |   |                                                              |   |   |   |   |   |   |   |   |
| Controls                - to external customers             |   | $      | 32,808 |   | $      | 30,009 |   |                                                              | 9% |   |   | -2% |   |   | 11% |   |
| Capacitors-                to external customers            |   |   | 1,822  |   |   | 1,666  |   |                                                              | 9% |   |   | -3% |   |   | 12% |   |
| Capacitors                - inter-segment                   |   |   | 64     |   |   | 199    |   |                                                              | -68% |   |   | -2% |   |   | -66% |   |
| Capacitors                - total                           |   |   | 1,886  |   |   | 1,865  |   |                                                              | 1% |   |   | -3% |   |   | 4% |   |
| Total                sales to external customers            |   |   | 34,630 |   |   | 31,675 |   |                                                              | 9% |   |   | -2% |   |   | 11% |   |
| Gross                Profit                                 |   |   |   |   |   |   |   |                                                              |   |   |   |   |   |   |   |   |
| Controls                                                    |   |   | 12,268 |   |   | 11,259 |   |                                                              | 9% |   |   | 0% |   |   | 9% |   |
| Capacitors                                                  |   |   | 838    |   |   | 777    |   |                                                              | 8% |   |   | -2% |   |   | 10% |   |
| Total                                                       |   |   | 13,106 |   |   | 12,036 |   |                                                              | 9% |   |   | 0% |   |   | 9% |   |
| Selling                research and administrative expenses |   |   |   |   |   |   |   |                                                              |   |   |   |   |   |   |   |   |
| Controls                                                    |   |   | 10,094 |   |   | 9,916  |   |                                                              | 2% |   |   | -2% |   |   | 4% |   |
| Capacitors                                                  |   |   | 770    |   |   | 745    |   |                                                              | 3% |   |   | -2% |   |   | 5% |   |
| Unallocated                corporate expense                |   |   | 398    |   |   | 376    |   |                                                              | 6% |   |   | 0% |   |   | 6% |   |
| Total                                                       |   |   | 11,262 |   |   | 11,037 |   |                                                              | 2% |   |   | -2% |   |   | 4% |   |
| Operating                income                             |   |   |   |   |   |   |   |                                                              |   |   |   |   |   |   |   |   |
| Controls                                                    |   |   | 2,174  |   |   | 1,343  |   |                                                              | 62% |   |   | 11% |   |   | 51% |   |
| Capacitors                                                  |   |   | 68     |   |   | 32     |   |                                                              | 113% |   |   | -3% |   |   | 116% |   |
| Unallocated                corporate expense                |   |   | (398   | )      |   | (376   | )      |                                                              | 6% |   |   | 0% |   |   | 6% |   |
| Total                                                       |   |   | 1,844  |   |   | 999    |   |                                                              | 85% |   |   | 15% |   |   | 70% |   |
| Other                income and expense                     |   |   | (110   | )      |   | (48    | )      |                                                              | 129% |   |   | 117% |   |   | 12% |   |
| Income                before income taxes                   |   |   | 1,734  |   |   | 951    |   |                                                              | 82% |   |   | 10% |   |   | 72% |   |
| Income                taxes                                 |   |   | (620   | )      |   | (310   | )      |                                                              | 100% |   |   | 12% |   |   | 88% |   |
| Net                Income                                   |   | $      | 1,114  |   | $      | 641    |   |                                                              | 74% |   |   | 9% |   |   | 65% |   |

----

| Selling,                research and                administrative expenses                                 |  (in              thousands of dollars) |        |
|-------------------------------------------------------------------------------------------------------------|----------------------------------------------|--------|
| Reported                expense in fiscal 2006                                                         |                                         | $      | 11,262 |   |
| Reported                expense in fiscal 2005                                                              |                                         |   | 11,037 |   |
| Increase                in expense                                                                          |                                         |   | 225 |   |
| Increase                (decrease) due to:                                                                  |                                         |   |   |   |
| Effect                of exchange rate changes                                                              |                                         |   | (200 | ) |
| Additional                engineering expense, net of currency effect                                       |                                         |   | 156 |   |
| Additional                sales and marketing expense, net of currency effect                               |                                         |   | 264 |   |
| Increased                cost of equity compensation in 2006                                                |                                         |   | 88 |   |
| Net                other operating expense decreases                                                        |                                         |   | (108 | ) |
| Total                increase in selling research and administrative expenses in fiscal                2006 |                                         | $      | 225 |   |

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|                                       |   |   |        |   |   |                            |   |   |                       |   |   |  (in              thousands of dollars)  |   |
|--------------------------------------------|--------|--------|-------------|--------|--------|---------------------------------|--------|--------|----------------------------|--------|--------|----------------------------------------------------|--------|
|                                            |   |   | Total  |   |   | Less                than 1 year |   |   | 1                - 3 years |   |   | 3                - 5 years                         |   |   | More                than 5 years |   |
| Long-term                debt obligations  |   | $      | -           |   | $      | -                               |   | $      | -                          |   | $      | -                                                  |   | $ | - |   |
| Capital                lease obligations   |   |   | -           |   |   | -                               |   |   | -                          |   |   | -                                                  |   |   | - |   |
| Operating                lease obligations |   |   | 2,547       |   |   | 236                             |   |   | 436                        |   |   | 381                                                |   |   | 1,494 |   |
| Purchase                Obligations        |   |   | 4,293       |   |   | 4,293                           |   |   | -                          |   |   | -                                                  |   |   | - |   |
| Other                long term liabilities |   |   | 61          |   |   | -                               |   |   | -                          |   |   | 61                                                 |   |   | - |   |
| Total                                      |   | $      | 6,901       |   | $      | 4,529                           |   | $      | 436                        |   | $      | 442                                                |   | $ | 1,494 |   |

ITEM      7A      QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET      RISK

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ITEM      8. FINANCIAL      STATEMENTS AND SUPPLEMENTARY DATA

CONSOLIDATED      BALANCE      SHEETS

| ASSETS                                                                                                                             |   |   | 2007   |   |   | 2006   |   |
|------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|
| Current                assets:                                                                                                     |   |   |   |   |   |   |   |
| Cash                and cash equivalents                                                                                           |   | $      | 1,014  |   | $      | 1,290  |   |
| Receivables,                net of allowances for doubtful accounts of $180 in 2007 and $141                in                2006 |   |   | 8,714  |   |   | 6,187  |   |
| Inventories                                                                                                                        |   |   | 5,422  |   |   | 4,717  |   |
| Prepaid                expenses and other current assets                                                                           |   |   | 916    |   |   | 847    |   |
| Total                current assets                                                                                                |   |   | 16,066 |   |   | 13,041 |   |
| Property,                plant and equipment,                at cost:                                                              |   |   |   |   |   |   |   |
| Land                and improvements                                                                                               |   |   | 29     |   |   | 26     |   |
| Buildings                and improvements                                                                                          |   |   | 2,462  |   |   | 2,256  |   |
| Equipment                                                                                                                          |   |   | 9,774  |   |   | 8,215  |   |
|                                                                                                                               |   |   | 12,265 |   |   | 10,497 |   |
| Less:                accumulated depreciation and amortization                                                                     |   |   | 8,497  |   |   | 7,202  |   |
| Net                property, plant and equipment                                                                                   |   |   | 3,768  |   |   | 3,295  |   |
| Long-term                deferred tax asset                                                                                        |   |   | 657    |   |   | 881    |   |
| Goodwill                                                                                                                           |   |   | 1,435  |   |   | 1,435  |   |
| Total                assets                                                                                                        |   | $      | 21,926 |   | $      | 18,652 |   |
|  LIABILITIES                AND STOCKHOLDERS’                EQUITY                                                     |   |   |   |   |   |   |   |
| Current                liabilities:                                                                                                |   |   |   |   |   |   |   |
| Accounts                payable                                                                                                    |   | $      | 3,398  |   | $      | 2,397  |   |
| Dividend                payable                                                                                                    |   |   | 97     |   |   | 96     |   |
| Accrued                expenses                                                                                                    |   |   | 3,162  |   |   | 2,701  |   |
| Accrued                taxes on income                                                                                             |   |   | 530    |   |   | 479    |   |
| Total                current liabilities                                                                                           |   |   | 7,187  |   |   | 5,673  |   |
| Liability                for pension benefits                                                                                      |   |   | 2,244  |   |   | 2,886  |   |
| Other                long term liabilities                                                                                         |   |   | 61     |   |   | 56     |   |
| Total                liabilities                                                                                                   |   |   | 9,492  |   |   | 8,615  |   |
| Commitments                and contingencies (note 5)                                                                              |   |   |   |   |   |   |   |
| Stockholders’                equity                                                                                          |   |   |   |   |   |   |   |
| Preferred                stock, par value $.10 per share - authorized - 1,000,000 shares;                outstanding - none        |   |   | -      |   |   | -      |   |
| Common                stock, par value $.10 per share - authorized - 8,000,000 shares;                outstanding                  |   |   |   |   |   |   |   |
| 3,238,702                shares in 2007 and 3,211,051 shares in 2006                                                               |   |   | 324    |   |   | 321    |   |
| Premium                paid in on common stock                                                                                     |   |   | 4,623  |   |   | 4,309  |   |
| Retained                earnings                                                                                                   |   |   | 7,961  |   |   | 7,123  |   |
| Accumulated                other comprehensive loss                                                                                |   |   | (474   | )      |   | (1,716 | )      |
| Total                stockholders’ equity                                                                                    |   |   | 12,434 |   |   | 10,037 |   |
| Total                liabilities and                stockholders’ equity                                                     |   | $      | 21,926 |   | $      | 18,652 |   |

----

CONSOLIDATED      STATEMENTS OF INCOME

|                                                         |   |   | 2007   |   |   | 2006   |   |   | 2005   |   |
|--------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Net                sales                                     |   | $      | 39,213 |   | $      | 34,630 |   | $      | 31,675 |   |
| Cost                of sales                                 |   |   | 24,865 |   |   | 21,524 |   |   | 19,639 |   |
| Gross                profit                                  |   |   | 14,348 |   |   | 13,106 |   |   | 12,036 |   |
| Selling,                research and administrative expenses |   |   | 12,285 |   |   | 11,262 |   |   | 11,037 |   |
| Operating                income                              |   |   | 2,063  |   |   | 1,844  |   |   | 999    |   |
| Interest                expense                              |   |   | (45    | )      |   | (64    | )      |   | (56    | )      |
| Interest                income                               |   |   | 10     |   |   | 6      |   |   | 4      |   |
| Foreign                currency gain (loss)                  |   |   | (40    | )      |   | (52    | )      |   | 4      |   |
| Income                before income taxes                    |   |   | 1,988  |   |   | 1,734  |   |   | 951    |   |
| Income                taxes                                  |   |   | (685   | )      |   | (620   | )      |   | (310   | )      |
| Net                income                                    |   | $      | 1,303  |   | $      | 1,114  |   | $      | 641    |   |
| Basic                income per share                        |   | $      | .41    |   | $      | .35    |   | $      | .21    |   |
| Diluted                income per share                      |   | $      | .41    |   | $      | .35    |   | $      | .20    |   |

CONSOLIDATED      STATEMENTS OF COMPREHENSIVE INCOME

|                                                            |   |   | 2007  |   |   | 2006  |   |   | 2005 |   |
|-----------------------------------------------------------------|--------|--------|-------|--------|--------|-------|--------|--------|------|--------|
| Net                income                                       |   | $      | 1,303 |   | $      | 1,114 |   | $      | 641  |   |
| Foreign                currency translation adjustment          |   |   | 732   |   |   | 459   |   |   | (208 | )      |
| Changes                in fair market value of cash flow hedges |   |   | 3     |   |   | -     |   |   | (15  | )      |
| Pension                liability adjustment, net of tax         |   |   | 507   |   |   | -     |   |   | -    |   |
| Comprehensive                income                             |   | $      | 2,545 |   | $      | 1,573 |   | $      | 418  |   |

----

CONSOLIDATED      STATEMENTS OF STOCKHOLDERS’EQUITY

|                                                                                                                                     |   |   | Common                stock  |   |   | Premium                paid in on common stock |   |   | Retained                earnings |   |   | Unearned                compensation on restricted stock |   |   | Cumulative                other comprehensive income (loss | )      |   | Total                stockholders’ equity |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-----------------------------------|--------|--------|------------------------------------------------|--------|--------|----------------------------------|--------|--------|----------------------------------------------------------|--------|--------|------------------------------------------------------------|--------|--------|-------------------------------------------------|--------|
| Balance                September 30, 2004                                                                                                          |   | $      | 313                               |   | $      | 4,047                                          |   | $      | 6,133                            |   | $      | -                                                        |   | $      | (29                                                        | )      | $      | 10,464                                          |   |
| Net                income                                                                                                                          |   |   | -                                 |   |   | -                                              |   |   | 641                              |   |   | -                                                        |   |   | -                                                          |   |   | 641                                             |   |
| Dividends                ($.12 per share)                                                                                                          |   |   | -                                 |   |   | -                                              |   |   | (380                             | )      |   | -                                                        |   |   | -                                                          |   |   | (380                                            | )      |
| Currency                translation adjustment                                                                                                     |   |   | -                                 |   |   | -                                              |   |   | -                                |   |   | -                                                        |   |   | (208                                                       | )      |   | (208                                            | )      |
| Change                in fair market value of cash flow hedge                                                                                      |   |   | -                                 |   |   | -                                              |   |   | -                                |   |   | -                                                        |   |   | (15                                                        | )      |   | (15                                             | )      |
| Issuance                of restricted stock                                                                                                        |   |   | 4                                 |   |   | 263                                            |   |   | -                                |   |   | (267                                                     | )      |   | -                                                          |   |   | -                                               |   |
| Restricted                stock expense                                                                                                            |   |   | -                                 |   |   | -                                              |   |   | -                                |   |   | 87                                                       |   |   | -                                                          |   |   | 87                                              |   |
| Balance                September 30, 2005                                                                                                          |   |   | 317                               |   |   | 4,310                                          |   |   | 6,394                            |   |   | (180                                                     | )      |   | (252                                                       | )      |   | 10,589                                          |   |
| Net                income                                                                                                                          |   |   | -                                 |   |   | -                                              |   |   | 1,114                            |   |   | -                                                        |   |   | -                                                          |   |   | 1,114                                           |   |
| Dividends                ($.12 per share)                                                                                                          |   |   | -                                 |   |   | -                                              |   |   | (385                             | )      |   | -                                                        |   |   | -                                                          |   |   | (385                                            | )      |
| Currency                translation adjustment                                                                                                     |   |   | -                                 |   |   | -                                              |   |   | -                                |   |   | -                                                        |   |   | 459                                                        |   |   | 459                                             |   |
| Reclassification                of unearned compensation  on                adoption of SFAS No. 123R                                         |   |   | -                                 |   |   | (180                                           | )      |   | -                                |   |   | 180                                                      |   |   | -                                                          |   |   | -                                               |   |
| Issuance                of restricted stock                                                                                                        |   |   | 4                                 |   |   | (4                                             | )      |   | -                                |   |   | -                                                        |   |   | -                                                          |   |   | -                                               |   |
| Exercise                of stock options                                                                                                           |   |   | -                                 |   |   | 8                                              |   |   | -                                |   |   | -                                                        |   |   | -                                                          |   |   | 8                                               |   |
| Equity                compensation expense                                                                                                         |   |   | -                                 |   |   | 175                                            |   |   | -                                |   |   |                                                     |   |   | -                                                          |   |   | 175                                             |   |
| Pension                liability adjustment to initially apply  SFAS                No. 158, net of tax benefit of $849                       |   |   | -                                 |   |   | -                                              |   |   | -                                |   |   | -                                                        |   |   | (1,923                                                     | )      |   | (1,923                                          | )      |
| Balance                September 30, 2006                                                                                                          |   |   | 321                               |   |   | 4,309                                          |   |   | 7,123                            |   |   | -                                                        |   |   | (1,716                                                     | )      |   | 10,037                                          |   |
| Net                income                                                                                                                          |   |   | -                                 |   |   | -                                              |   |   | 1,303                            |   |   | -                                                        |   |   | -                                                          |   |   | 1,303                                           |   |
| Dividends                ($.12 per                share)                                                                                           |   |   | -                                 |   |   | -                                              |   |   | (387                             | )      |   | -                                                        |   |   | -                                                          |   |   | (387                                            | )      |
| Currency                translation                adjustment                                                                                      |   |   | -                                 |   |   | -                                              |   |   | -                                |   |   | -                                                        |   |   | 732                                                        |   |   | 732                                             |   |
| Change                in fair market value of                cash flow hedge                                                                       |   |   | -                                 |   |   | -                                              |   |   | -                                |   |   | -                                                        |   |   | 3                                                          |   |   | 3                                               |   |
| Issuance                of restricted                stock                                                                                         |   |   | 2                                 |   |   | (2                                             | )      |   | -                                |   |   | -                                                        |   |   | -                                                          |   |   | -                                               |   |
| Exercise                of stock                options                                                                                            |   |   | 2                                 |   |   | 94                                             |   |   | -                                |   |   | -                                                        |   |   | -                                                          |   |   | 96                                              |   |
| Purchase                and retirement of                common stock  in                connection with stock option                exercise |   |   | (1                                | )      |   | (11                                            | )      |   | (78                              | )      |   | -                                                        |   |   | -                                                          |   |   | (90                                             | )      |
| Tax                benefit on exercise of                stock options                                                                             |   |   | -                                 |   |   | 40                                             |   |   | -                                |   |   | -                                                        |   |   | -                                                          |   |   | 40                                              |   |
| Equity                compensation                expense                                                                                          |   |   |                              |   |   | 193                                            |   |   |                             |   |   |                                                     |   |   |                                                       |   |   | 193                                             |   |
| Pension                liability adjustment,                net of tax  charge                of                $239                          |   |   | -                                 |   |   | -                                              |   |   | -                                |   |   | -                                                        |   |   | 507                                                        |   |   | 507                                             |   |
| Balance                September 30,                2007                                                                                           |   | $      | 324                               |   | $      | 4,623                                          |   | $      | 7,961                            |   | $      | -                                                        |   | $      | (474                                                       | )      | $      | 12,434                                          |   |

----

CONSOLIDATED      STATEMENTS OF CASH FLOWS

|                                                                                                                  |   |   | 2007   |   |   | 2006   |   |   | 2005   |   |
|-----------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Cash                flow from operating activities:                                                                   |   |   |   |   |   |   |   |   |   |   |
| Net                income                                                                                             |   | $      | 1,303  |   | $      | 1,114  |   | $      | 641    |   |
| Adjustments                to reconcile net income to net cash from operating                activities:              |   |   |   |   |   |   |   |   |   |   |
| Depreciation                and amortization                                                                          |   |   | 739    |   |   | 657    |   |   | 661    |   |
| Stock-based                compensation                                                                               |   |   | 193    |   |   | 175    |   |   | 87     |   |
| Pension                contributions in excess of pension expenses                                                    |   |   | (45    | )      |   | -      |   |   | -      |   |
| Deferred                tax provision (benefit)                                                                       |   |   | 61     |   |   | 64     |   |   | (6     | )      |
| Increase                (decrease) in cash resulting from changes in operating assets and                liabilities: |   |   |   |   |   |   |   |   |   |   |
| Receivables                                                                                                           |   |   | (2,058 | )      |   | 6      |   |   | (84    | )      |
| Inventories                                                                                                           |   |   | (372   | )      |   | (980   | )      |   | 306    |   |
| Prepaid                expenses and other current assets                                                              |   |   | (45    | )      |   | 10     |   |   | (21    | )      |
| Accounts                payable                                                                                       |   |   | 815    |   |   | (202   | )      |   | (401   | )      |
| Accrued                expenses                                                                                       |   |   | 259    |   |   | 16     |   |   | 144    |   |
| Accrued                taxes on income                                                                                |   |   | (1     | )      |   | 34     |   |   | (2     | )      |
| Proceeds                of rental deposit                                                                             |   |   | -      |   |   | 56     |   |   | -      |   |
| Net                cash generated from operating activities                                                           |   |   | 849    |   |   | 950    |   |   | 1,324  |   |
| Cash                flow used by investing activities:                                                                |   |   |   |   |   |   |   |   |   |   |
| Acquisition                of property, plant and equipment                                                           |   |   | (909   | )      |   | (706   | )      |   | (571   | )      |
| Net                cash used by investing activities                                                                  |   |   | (909   | )      |   | (706   | )      |   | (571   | )      |
| Cash                flow used by financing activities:                                                                |   |   |   |   |   |   |   |   |   |   |
| Dividends                paid                                                                                         |   |   | (386   | )      |   | (384   | )      |   | (379   | )      |
| Exercise                of stock options                                                                              |   |   | 6      |   |   | 8      |   |   | -      |   |
| Net                cash used by financing activities                                                                  |   |   | (380   | )      |   | (376   | )      |   | (379   | )      |
| Effect                of exchange rate changes on cash                                                                |   |   | 164    |   |   | 292    |   |   | (149   | )      |
| Net                (decrease) increase in cash                                                                        |   |   | (276   | )      |   | 160    |   |   | 225    |   |
| Beginning                balance - cash and cash equivalents                                                          |   |   | 1,290  |   |   | 1,130  |   |   | 905    |   |
| Ending                balance - cash and cash equivalents                                                             |   | $      | 1,014  |   | $      | 1,290  |   | $      | 1,130  |   |
| Supplemental                disclosure of cash flow information:                                                      |   |   |   |   |   |   |   |   |   |   |
| Cash                paid for income taxes                                                                             |   | $      | 677    |   | $      | 650    |   | $      | 354    |   |
| Cash                paid for interest                                                                                 |   | $      | 45     |   | $      | 64     |   | $      | 56     |   |
| Supplemental                disclosure of non-cash financing activity:                                                |   |   |   |   |   |   |   |   |   |   |
| Dividend                declared                                                                                      |   | $      | 97     |   | $      | 96     |   | $      | 95     |   |

----

|                                                                                                         |   |   | 2007 |   |   | 2006 |   |
|--------------------------------------------------------------------------------------------------------------|--------|--------|------|--------|--------|------|--------|
| Warranty                reserves at beginning of year                                                        |   | $      | 364  |   | $      | 364  |   |
| Decrease                in beginning balance for warranty obligations settled during the                year |   |   | (308 | )      |   | (329 | )      |
| Other                changes to pre-existing warranties                                                      |   |   | 16   |   |   | 4    |   |
| Net                increase in warranty reserves for products sold during the                year            |   |   | 386  |   |   | 325  |   |
| Warranty                reserves at end of year                                                              |   | $      | 458  |   | $      | 364  |   |

| (in                thousands of dollars except per share data)     |   |
|-------------------------------------------------------------------------|--------|
|                                                                    |   |   | 2005 |   |
| Net                income - As reported                                 |   | $ | 641 |   |
| Pro-forma                effect of expensing stock options (net of tax) |   | $ | (52 | ) |
| Net                income - Pro forma                                   |   | $ | 589 |   |
| Basic                net income per share - As reported                 |   | $ | .21 |   |
| Basic                net income per share - Pro forma                   |   | $ | .19 |   |
| Diluted                net income per share - As reported               |   | $ | .20 |   |
| Diluted                net income per share - Pro forma                 |   | $ | .19 |   |

----

|                          |   |   | 2007  |   |   | 2006  |   |
|-------------------------------|--------|--------|-------|--------|--------|-------|--------|
| Raw                materials  |   | $      | 2,517 |   | $      | 2,195 |   |
| Work-in-process               |   |   | 134   |   |   | 119   |   |
| Finished                goods |   |   | 2,771 |   |   | 2,403 |   |
|                          |   | $      | 5,422 |   | $      | 4,717 |   |

----

|                                                                                                  |                                                             | 2007                                                                                          |                                               | 2006                                    |
|-------------------------------------------------------------------------------------------------------|------------------------------------------------------------------|-----------------------------------------------------------------------------------------------|----------------------------------------------------|-----------------------------------------|
|                                                                                                  | NotionalAmount                                                   | AverageContract                    Rate                                                       | NotionalAmount                                     | AverageContract                    Rate |
| Sell                    Euros for British PoundsSell                    US Dollars for British Pounds | $2,942$                    2,700                                 | €1.45                    = £1$1.99                    =                    £1 | $                        -$250 | -$1.73                    = £1     |
| Total                                                                                                 | $                    5,642                                       |                                                                                          | $250                                               |                                    |
| Estimated                    fair value *                                                             | $                         43            |                                                                                          | $                     19                      |                                    |
| Amount                    recorded as other comprehensive income                                      | $                           3 |                                                                                          | $                       -           |                                    |

|                                                                   |   |   | 2007  |   |   | 2006  |   |   | 2005  |   |
|------------------------------------------------------------------------|--------|--------|-------|--------|--------|-------|--------|--------|-------|--------|
| Net                income                                              |   | $      | 1,303 |   | $      | 1,114 |   | $      | 641   |   |
| Weighted                average shares outstanding                     |   |   | 3,167 |   |   | 3,139 |   |   | 3,125 |   |
| Basic                income per share                                  |   | $      | .41   |   | $      | .35   |   | $      | .21   |   |
| Common                stock equivalents                                |   |   | 47    |   |   | 27    |   |   | 27    |   |
| Average                common and common equivalent shares outstanding |   |   | 3,214 |   |   | 3,166 |   |   | 3,152 |   |
| Diluted                income per share                                |   | $      | .41   |   | $      | .35   |   | $      | .20   |   |

----

----

|                                        |   |   | Shares                under option  |   |   | Weighted                average exercise                price |   |   | Weighted                average remaining contractual life (years | )      |   | Aggregate                Intrinsic value |   |
|--------------------------------------------------|--------|--------|------------------------------------------|--------|--------|---------------------------------------------------------------|--------|--------|-------------------------------------------------------------------|--------|--------|------------------------------------------|--------|
| Outstanding                at September 30, 2004 |   |   | 188,000                                  |   | $      | 9.42                                                          |   |   |                                                              |   |   |                                     |   |
| Cancelled                in 2005                 |   |   | (6,000                                   | )      | $      | 14.48                                                         |   |   |                                                              |   |   |                                     |   |
| Outstanding                at September 30, 2005 |   |   | 182,000                                  |   | $      | 9.26                                                          |   |   |                                                              |   |   |                                     |   |
| Exercised                in 2006                 |   |   | (2,000                                   | )      | $      | 4.37                                                          |   |   |                                                              |   |   |                                     |   |
| Cancelled                in 2006                 |   |   | (8,000                                   | )      | $      | 8.46                                                          |   |   |                                                              |   |   |                                     |   |
| Outstanding                at September 30, 2006 |   |   | 172,000                                  |   | $      | 9.35                                                          |   |   |                                                              |   |   |                                     |   |
| Exercised                in 2007                 |   |   | (22,000                                  | )      | $      | 4.37                                                          |   |   |                                                              |   |   |                                     |   |
| Cancelled                in 2007                 |   |   | (21,000                                  | )      | $      | 13.84                                                         |   |   |                                                              |   |   |                                     |   |
| Outstanding                at September 30, 2007 |   |   | 129,000                                  |   | $      | 9.47                                                          |   |   | 2                years                                            |   | $      | 204,000                                  |   |
| Exercisable                at September 30, 2007 |   |   | 93,250                                   |   | $      | 10.38                                                         |   |   | 3                years                                            |   | $      | 111,000                                  |   |

| Price                range      |   |   | Shares                under option |   |   | Weighted                average remaining contractual life |   |
|---------------------------------|--------|--------|------------------------------------|--------|--------|------------------------------------------------------------|--------|
| $                4.37 - $ 6.56  |   |   | 49,000                             |   |   | 6                years                                     |   |
| $                6.57 - $ 9.85  |   |   | 10,000                             |   |   | 4                years                                     |   |
| $                9.86 - $14.79  |   |   | 50,000                             |   |   | 1                years                                     |   |
| $                14.80 - $22.20 |   |   | 20,000                             |   |   | 0.3                years                                   |   |
|                            |   |   | 129,000                            |   |   | 2                years                                     |   |

----

|                                                                          |   |   | 2007 |   |   | 2006   |   |   | 2005   |   |
|-------------------------------------------------------------------------------|--------|--------|------|--------|--------|--------|--------|--------|--------|--------|
| Beginning                Balance - Non-vested                                 |   |   | 65   |   |   | 47     |   |   | -      |   |
| Granted                to employees - 5 year vesting                          |   |   | -    |   |   | 25     |   |   | 35     |   |
| Granted                to employees - 8 month vesting                         |   |   | 2    |   |   |   |   |   |   |   |
| Granted                to non-employee directors - 1 year vesting             |   |   | 12   |   |   | 12     |   |   | 12     |   |
| Vested                                                                        |   |   | (24  | )      |   | (19    | )      |   | -      |   |
| Forfeited                                                                     |   |   | -    |   |   | -      |   |   | -      |   |
| Ending                Balance - Non-vested                                    |   |   | 55   |   |   | 65     |   |   | 47     |   |
| Weighted-average                fair value for shares granted during the year |   | $      | 7.77 |   | $      | 5.58   |   | $      | 6.18   |   |
| Weighted-average                fair value for shares vested during the year  |   | $      | 5.72 |   | $      | 6.64   |   | $      | -      |   |
| Weighted-average                fair value for ending balance - non-vested    |   | $      | 6.22 |   | $      | 5.70   |   | $      | 6.18   |   |

|                                                    |   |   | 2007   |   |   | 2006   |   |   | 2005   |   |
|---------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Stock                option expense under SFAS No. 123R |   | $      | 33     |   | $      | 46     |   | $      | -      |   |
| Restricted                stock grants:                 |   |   |   |   |   |   |   |   |   |   |
| Employees                                               |   | $      | 84     |   | $      | 55     |   | $      | 30     |   |
| Non-employee                directors                   |   | $      | 76     |   | $      | 74     |   | $      | 57     |   |
| Total                stock based compensation expense   |   | $      | 193    |   | $      | 175    |   | $      | 87     |   |

----

|     |   |   | 2007  |   |   | 2006  |   |   | 2005 |   |
|----------|--------|--------|-------|--------|--------|-------|--------|--------|------|--------|
| Domestic |   | $      | (53   | )      | $      | (87   | )      | $      | 1    |   |
| Foreign  |   |   | 2,041 |   |   | 1,821 |   |   | 950  |   |
|     |   | $      | 1,988 |   | $      | 1,734 |   | $      | 951  |   |

|    |   |   |          |   |   | 2007     |   |   |   |   |
|---------|--------|--------|---------------|--------|--------|----------|--------|--------|--------|--------|
|         |   |   | Current  |   |   | Deferred |   |   | Total  |   |
| Federal |   | $      | 60            |   | $      | (45      | )      | $      | 15     |   |
| State   |   |   | 1             |   |   | (16      | )      |   | (15    | )      |
| Foreign |   |   | 660           |   |   | 25       |   |   | 685    |   |
|    |   | $      | 721           |   | $      | (36      | )      | $      | 685    |   |
|    |   |   |          |   |   | 2006     |   |   |   |   |
|         |   |   | Current  |   |   | Deferred |   |   | Total  |   |
| Federal |   | $      | 77            |   | $      | (45      | )      | $      | 32     |   |
| State   |   |   | 21            |   |   | (1       | )      |   | 20     |   |
| Foreign |   |   | 504           |   |   | 65       |   |   | 569    |   |
|    |   | $      | 601           |   | $      | 19       |   | $      | 620    |   |
|    |   |   |          |   |   | 2005     |   |   |   |   |
|    |   |   | Current  |   |   | Deferred |   |   | Total  |   |
| Federal |   | $      | 24            |   | $      | (32      | )      | $      | (8     | )      |
| State   |   |   | 7             |   |   | 8        |   |   | 15     |   |
| Foreign |   |   | 338           |   |   | (35      | )      |   | 303    |   |
|    |   | $      | 369           |   | $      | (59      | )      | $      | 310    |   |

|                                                           |   |   | 2007   |   |   | 2006   |   |   | 2005   |   |
|----------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Statutory                Federal income tax rate               |   |   | 34%    |   |   | 34%    |   |   | 34%    |   |
| Computed                tax provision at statutory rate        |   | $      | 676    |   | $      | 590    |   | $      | 323    |   |
| Increases                (decreases) resulting from:           |   |   |   |   |   |   |   |   |   |   |
| Foreign                tax rate differentials                  |   |   | (64    | )      |   | (53    | )      |   | (20    | )      |
| State                taxes net of federal tax benefit          |   |   | 7      |   |   | 13     |   |   | (7     | )      |
| Change                in deferred tax valuation allowance      |   |   | (18    | )      |   | 58     |   |   | 7      |   |
| Other                                                          |   |   | 84     |   |   | 12     |   |   | 7      |   |
| Income                tax provision in the Statement of Income |   | $      | 685    |   | $      | 620    |   | $      | 310    |   |

----

|                                              |   |   |                                  |   | 2007   |                              |   |   |
|---------------------------------------------------|--------|--------|---------------------------------------|--------|--------|-----------------------------------|--------|--------|
|                                              |   |   | Domestic                current  |   |   | Domestic                long-term |   |   | Foreign                current |   |   | Foreignlong-term |   |
| Assets:                                           |   |   |                                  |   |   |                              |   |   |   |   |   |   |   |
| Pension                accruals (prepaid)         |   | $      | 78                                    |   | $      | 160                               |   | $      | - |   | $ | 514 |   |
| Inventory                basis differences        |   |   | 61                                    |   |   | -                                 |   |   | 62 |   |   | - |   |
| Warranty                reserves                  |   |   | 48                                    |   |   | -                                 |   |   | - |   |   | - |   |
| Foreign                tax credit carry forwards  |   |   | 224                                   |   |   | -                                 |   |   | - |   |   | - |   |
| Accrued                compensation expense       |   |   | 209                                   |   |   | -                                 |   |   | 62 |   |   | - |   |
| Other                (net)                        |   |   | 12                                    |   |   | -                                 |   |   | - |   |   | - |   |
|                                              |   |   | 632                                   |   |   | 160                               |   |   | 124 |   |   | 514 |   |
| Liabilities:                                      |   |   |                                  |   |   |                              |   |   |   |   |   |   |   |
| Property                basis differences         |   |   | -                                     |   |   | -                                 |   |   | - |   |   | (17 | ) |
| Net                asset (liability)              |   |   | 632                                   |   |   | 160                               |   |   | 124 |   |   | 497 |   |
| Valuation                allowance                |   |   | (171                                  | )      |   | -                                 |   |   | - |   |   | - |   |
| Net                deferred tax asset (liability) |   | $      | 461                                   |   | $      | 160                               |   | $      | 124 |   | $ | 497 |   |

|                                              |   |   |                                  |   | 2006   |                              |   |   |
|---------------------------------------------------|--------|--------|---------------------------------------|--------|--------|-----------------------------------|--------|--------|
|                                              |   |   | Domestic                current  |   |   | Domestic                long-term |   |   | Foreign                current |   |   | Foreign                long-term |   |
| Assets:                                           |   |   |                                  |   |   |                              |   |   |   |   |   |   |   |
| Pension                accruals (prepaid)         |   | $      | 83                                    |   | $      | 233                               |   | $      | 28 |   | $ | 687 |   |
| Inventory                basis differences        |   |   | 58                                    |   |   | -                                 |   |   | 58 |   |   | - |   |
| Warranty                reserves                  |   |   | 45                                    |   |   | -                                 |   |   | - |   |   | - |   |
| Foreign                tax credit carry forwards  |   |   | 189                                   |   |   | -                                 |   |   | - |   |   | - |   |
| Accrued                compensation expense       |   |   | 196                                   |   |   | -                                 |   |   | - |   |   | - |   |
| Other                (net)                        |   |   | 34                                    |   |   | -                                 |   |   | 2 |   |   | - |   |
|                                              |   |   | 605                                   |   |   | 233                               |   |   | 88 |   |   | 687 |   |
| Liabilities:                                      |   |   |                                  |   |   |                              |   |   |   |   |   |   |   |
| Property                basis differences         |   |   | -                                     |   |   | (22                               | )      |   | - |   |   | (17 | ) |
| Net                asset (liability)              |   |   | 605                                   |   |   | 211                               |   |   | 88 |   |   |   |   |
| Valuation                allowance                |   |   | (189                                  | )      |   | -                                 |   |   | - |   |   | - |   |
| Net                deferred tax asset (liability) |   | $      | 416                                   |   | $      | 211                               |   | $      | 88 |   | $ | 670 |   |

|                                                  |   |   | 2007  |   |   | 2006  |   |
|-------------------------------------------------------|--------|--------|-------|--------|--------|-------|--------|
| Accrued                compensation and related costs |   | $      | 1,118 |   | $      | 1,047 |   |
| Warranty                reserves                      |   |   | 458   |   |   | 364   |   |
| Other                accrued expenses                 |   |   | 1,586 |   |   | 1,290 |   |
|                                                  |   | $      | 3,162 |   | $      | 2,701 |   |

----

|                                                                        |   |   | 2007   |   |   | 2006   |   |
|-----------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|
| Change                in benefit                obligation:                 |   |   |   |   |   |   |   |
| Benefit                obligation at beginning of year                      |   | $      | 20,476 |   | $      | 15,910 |   |
| Service                cost                                                 |   |   | 592    |   |   | 393    |   |
| Interest                cost                                                |   |   | 1,159  |   |   | 972    |   |
| Plan                participants contributions                              |   |   | 289    |   |   | 269    |   |
| Actuarial                (gain) loss                                        |   |   | 510    |   |   | 2,209  |   |
| Benefits                paid                                                |   |   | (234   | )      |   | (58    | )      |
| Foreign                currency exchange rate changes                       |   |   | 1,732  |   |   | 781    |   |
| Benefit                obligation at end of year                            |   |   | 24,524 |   |   | 20,476 |   |
| Change                in plan                assets:                        |   |   |   |   |   |   |   |
| Fair                value of plan assets at beginning of year               |   |   | 17,590 |   |   | 14,210 |   |
| Return                on plan assets                                        |   |   | 2,333  |   |   | 1,575  |   |
| Employer                contributions                                       |   |   | 758    |   |   | 871    |   |
| Plan                participants contributions                              |   |   | 289    |   |   | 269    |   |
| Benefits                paid                                                |   |   | (234   | )      |   | (58    | )      |
| Foreign                currency exchange rate changes                       |   |   | 1,544  |   |   | 723    |   |
| Fair                value of plan assets at end of year                     |   |   | 22,280 |   |   | 17,590 |   |
| Funded                status                                                |   |   | (2,244 | )      |   | (2,886 | )      |
| Unrecognized                transition obligation (asset)                   |   |   | n/a    |   |   | n/a    |   |
| Unrecognized                prior service cost                              |   |   | n/a    |   |   | n/a    |   |
| Unrecognized                net actuarial (gain) loss                       |   |   | n/a    |   |   | n/a    |   |
| Accrued                benefit cost                                         |   |   | n/a    |   |   | n/a    |   |
| Liability                for pension benefits recorded in the balance sheet |   | $      | (2,244 | )      | $      | (2,886 | )      |

|                                                                     |   |   | Before                implementation of SFAS No. 158  |   |   | Change                due to SFAS No. 158 |   |   | After                implementation of SFAS No. 158 |   |
|--------------------------------------------------------------------------|--------|--------|------------------------------------------------------------|--------|--------|-------------------------------------------|--------|--------|-----------------------------------------------------|--------|
| ASSETS                                                                   |   |   |                                                       |   |   |                                      |   |   |                                                |   |
| Prepaid                expense and other current assets                  |   | $      | 1,290                                                      |   | $      | (443                                      | )      | $      | 847                                                 |   |
| Total                current assets                                      |   |   | 13,484                                                     |   |   | (443                                      | )      |   | 13,041                                              |   |
| Long-term                deferred tax asset                              |   |   | -                                                          |   |   | 881                                       |   |   | 881                                                 |   |
| Total                assets                                              |   |   | 18,214                                                     |   |   | 438                                       |   |   | 18,652                                              |   |
| LIABILITIES                AND STOCKHOLDERS’                EQUITY |   |   |                                                       |   |   |                                      |   |   |                                                |   |
| Accrued                expenses                                          |   |   | 3,102                                                      |   |   | (401                                      | )      |   | 2,701                                               |   |
| Total                Current liabilities                                 |   |   | 6,074                                                      |   |   | (401                                      | )      |   | 5,673                                               |   |
| Deferred                taxes on income                                  |   |   | 124                                                        |   |   | (124                                      | )      |   | -                                                   |   |
| Liability                for pension benefits                            |   |   | -                                                          |   |   | 2,886                                     |   |   | 2,886                                               |   |
| Cumulative                other comprehensive income                     |   |   | 207                                                        |   |   | (1,923                                    | )      |   | (1,716                                              | )      |
| Total                Stockholders’ equity                          |   |   | 11,960                                                     |   |   | (1,923                                    | )      |   | 10,037                                              |   |
| Total                liabilities and stockholders’ equity          |   |   | 18,214                                                     |   |   | 438                                       |   |   | 18,652                                              |   |

----

|                                                    |   |   | 2007   |   |   | 2006   |   |   | 2005   |   |
|---------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Components                of net periodic benefit cost: |   |   |   |   |   |   |   |   |   |   |
| Service                cost                             |   | $      | 592    |   | $      | 382    |   | $      | 434    |   |
| Interest                cost                            |   |   | 1,159  |   |   | 942    |   |   | 901    |   |
| Expected                return on plan assets           |   |   | (1,148 | )      |   | (886   | )      |   | (845   | )      |
| Amortization                of transition obligation    |   |   | (1     | )      |   | (2     | )      |   | (2     | )      |
| Amortization                of prior service cost       |   |   | 59     |   |   | 54     |   |   | 55     |   |
| Recognized                net actuarial gain (loss)     |   |   | 14     |   |   | -      |   |   | -      |   |
| Net                periodic benefit cost                |   | $      | 675    |   | $      | 490    |   | $      | 543    |   |
| Net                cost of defined contribution plans   |   | $      | 147    |   | $      | 35     |   | $      | 29     |   |

|                                                    |   |   | 2007   |   |   | 2006   |   |
|---------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|
| Plan                obligations:                        |   |   |   |   |   |   |   |
| Discount                rate                            |   |   | 5.76%  |   |   | 5.27%  |   |
| Rate                of compensation increase            |   |   | 4.25%  |   |   | 3.98%  |   |
| Net                periodic benefit cost:               |   |   |   |   |   |   |   |
| Discount                rate                            |   |   | 5.76%  |   |   | 5.27%  |   |
| Expected                long term return on plan assets |   |   | 6.50%  |   |   | 6.04%  |   |
| Rate                of compensation increase            |   |   | 4.25%  |   |   | 3.98%  |   |

|                             |   |   |                         |   |   | 2007                   |   |   |   |   |   |                   |   |   | 2006                   |   |   |   |   |
|----------------------------------|--------|--------|------------------------------|--------|--------|------------------------|--------|--------|--------|--------|--------|------------------------|--------|--------|------------------------|--------|--------|--------|--------|
|                             |   |   | US                Plan  |   |   | UK                Plan |   |   | Total  |   |   | US                Plan |   |   | UK                Plan |   |   | Total  |   |
| Equity                securities |   |   | 40%                          |   |   | 53%                    |   |   | 52%    |   |   | 39%                    |   |   | 43%                    |   |   | 42%    |   |
| Debt                securities   |   |   | 54%                          |   |   | 26%                    |   |   | 28%    |   |   | 56%                    |   |   | 36%                    |   |   | 38%    |   |
| Real                estate       |   |   | -                            |   |   | 17%                    |   |   | 16%    |   |   | -                      |   |   | 17%                    |   |   | 16%    |   |
| Other                            |   |   | 6%                           |   |   | 4%                     |   |   | 4%     |   |   | 5%                     |   |   | 4%                     |   |   | 4%     |   |
| Total                            |   |   | 100%                         |   |   | 100%                   |   |   | 100%   |   |   | 100%                   |   |   | 100%                   |   |   | 100%   |   |

| 2007                       | $111  |
|----------------------------|-------|
| 2008                       | 154   |
| 2009                       | 198   |
| 2010                       | 303   |
| 2011                       | 437   |
| 2012                - 2016 | 4,039 |

----

|                                                        |   |   |           |   |   |       |   |   | 2007      |   |   |   |   |
|-------------------------------------------------------------|--------|--------|----------------|--------|--------|------------|--------|--------|-----------|--------|--------|--------|--------|
|                                                        |   |   | Controls  |   |   | Capacitors |   |   | Corporate |   |   | Total  |   |
| Sales                to external                customers   |   | $      | 37,009         |   | $      | 2,204      |   | $      | -         |   | $      | 39,213 |   |
| Inter-segment                revenues                       |   |   | -              |   |   | 52         |   |   | -         |   |   | 52     |   |
| Operating                income                             |   |   | 2,669          |   |   | (289       | )      |   | (317      | )      |   | 2,063  |   |
| Depreciation                and                amortization |   |   | 686            |   |   | 56         |   |   | -         |   |   |   |   |
| Identifiable                assets                          |   |   | 20,338         |   |   | 1,090      |   |   | 498       |   |   | 21,296 |   |
| Capital                expenditures                         |   |   | 823            |   |   | 87         |   |   | -         |   |   | 910    |   |
|                                                        |   |   |           |   |   |       |   |   | 2006      |   |   |   |   |
|                                                        |   |   | Controls  |   |   | Capacitors |   |   | Corporate |   |   | Total  |   |
| Sales                to external customers                  |   | $      | 32,808         |   | $      | 1,822      |   | $      | -         |   | $      | 34,630 |   |
| Inter-segment                revenues                       |   |   | -              |   |   | 64         |   |   | -         |   |   | 64     |   |
| Operating                income                             |   |   | 2,174          |   |   | 68         |   |   | (398      | )      |   | 1,844  |   |
| Depreciation                and amortization                |   |   | 586            |   |   | 71         |   |   | -         |   |   | 657    |   |
| Identifiable                assets                          |   |   | 17,121         |   |   | 1,097      |   |   | 434       |   |   | 18,652 |   |
| Capital                expenditures                         |   |   | 664            |   |   | 42         |   |   | -         |   |   | 706    |   |
|                                                        |   |   |           |   |   |       |   |   | 2005      |   |   |   |   |
|                                                        |   |   | Controls  |   |   | Capacitors |   |   | Corporate |   |   | Total  |   |
| Sales                to external customers                  |   | $      | 30,009         |   | $      | 1,666      |   | $      | -         |   | $      | 31,675 |   |
| Inter-segment                revenues                       |   |   | -              |   |   | 199        |   |   | -         |   |   | 199    |   |
| Operating                income                             |   |   | 1,343          |   |   | 32         |   |   | (376      | )      |   | 999    |   |
| Depreciation                and amortization                |   |   | 611            |   |   | 50         |   |   | -         |   |   | 661    |   |
| Identifiable                assets                          |   |   | 14,948         |   |   | 951        |   |   | 547       |   |   | 16,446 |   |
| Capital                expenditures                         |   |   | 536            |   |   | 35         |   |   | -         |   |   | 571    |   |

|                              |   |   | 2007   |   |   | 2006   |   |   | 2005   |   |
|-----------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Sales:-                           |   |   |   |   |   |   |   |   |   |   |
| US                sales           |   | $      | 14,832 |   | $      | 14,643 |   | $      | 12,893 |   |
| Foreign                sales:     |   |   |   |   |   |   |   |   |   |   |
| United                Kingdom     |   |   | 12,338 |   |   | 10,702 |   |   | 9,477  |   |
| France                            |   |   | 12,043 |   |   | 9,285  |   |   | 9,305  |   |
| Total                Foreign      |   |   | 24,381 |   |   | 19,987 |   |   | 18,782 |   |
| Total                sales        |   | $      | 39,213 |   | $      | 34,630 |   | $      | 31,675 |   |
| Long-lived                assets: |   |   |   |   |   |   |   |   |   |   |
| USA                               |   | $      | 1,516  |   | $      | 1,732  |   | $      | 1,543  |   |
| Foreign:                          |   |   |   |   |   |   |   |   |   |   |
| United                Kingdom     |   |   | 3,530  |   |   | 3,768  |   |   | 2,866  |   |
| France                            |   |   | 142    |   |   | 90     |   |   | 51     |   |
| Korea                and Japan    |   |   | 8      |   |   | 21     |   |   | 11     |   |
| Total                Foreign      |   |   | 3,680  |   |   | 3,879  |   |   | 2,928  |   |
| Total                             |   | $      | 5,196  |   | $      | 5,611  |   | $      | 4,471  |   |

----

Report      of Independent Registered Public Accounting Firm

----

|                                                   |   |   | First                Quarter  |   |   | SecondQuarter |   |   | ThirdQuarter |   |   | FourthQuarter |   |   | TotalYear |   |
|--------------------------------------------------------|--------|--------|------------------------------------|--------|--------|---------------|--------|--------|--------------|--------|--------|---------------|--------|--------|-----------|--------|
| 2007                Quarters                           |   |   |                               |   |   |          |   |   |         |   |   |          |   |   |      |   |
| Net                sales                               |   | $      | 8,226                              |   | $      | 10,374        |   | $      | 10,341       |   | $      | 10,272        |   | $      | 39,213    |   |
| Gross                profit                            |   |   | 2,998                              |   |   | 4,014         |   |   | 3,791        |   |   | 3,545         |   |   | 14,348    |   |
| Operating                income                        |   |   | 204                                |   |   | 898           |   |   | 782          |   |   | 179           |   |   | 2,063     |   |
| Net                income                              |   |   | 88                                 |   |   | 568           |   |   | 483          |   |   | 164           |   |   | 1,303     |   |
| Basic                income per share                  |   | $      | .03                                |   | $      | .18           |   | $      | .15          |   | $      | .05           |   | $      | .41       |   |
| Diluted                income per                share |   | $      | .03                                |   | $      | .18           |   | $      | .15          |   | $      | .05           |   | $      | .41       |   |
| 2006                Quarters                           |   |   |                               |   |   |          |   |   |         |   |   |          |   |   |      |   |
| Net                sales                               |   | $      | 7,821                              |   | $      | 8,562         |   | $      | 9,313        |   | $      | 8,934         |   | $      | 34,630    |   |
| Gross                profit                            |   |   | 3,047                              |   |   | 3,317         |   |   | 3,552        |   |   | 3,190         |   |   | 13,106    |   |
| Operating                income                        |   |   | 244                                |   |   | 562           |   |   | 584          |   |   | 454           |   |   | 1,844     |   |
| Net                income                              |   |   | 160                                |   |   | 342           |   |   | 369          |   |   | 243           |   |   | 1,114     |   |
| Basic                income per share                  |   | $      | .05                                |   | $      | .11           |   | $      | .12          |   | $      | .08           |   | $      | .35       |   |
| Diluted                income per share                |   | $      | .05                                |   | $      | .11           |   | $      | .12          |   | $      | .08           |   | $      | .35       |   |

ITEM      9 CHANGES      IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL      DISCLOSURE

ITEM      9A CONTROLS AND      PROCEDURES

ITEM      9B OTHER      INFORMATION

PART      III

ITEM      10 DIRECTORS,      EXECUTIVE OFFICERS AND CORPORATE      GOVERNANCE

----

| Name                  of Officer   | Age | Position                                                                                       |
|------------------------------------|-----|------------------------------------------------------------------------------------------------|
| Matthew                  Boyle     | 45  | President                  & Chief Executive Officer                                       |
| Paul                  A. McPartlin | 62  | Vice                  President & Chief Financial Officer                                  |
| Paul                  N. Farquhar  | 45  | Vice                  President, Treasurer & Principal Accounting                  Officer |

ITEM      12 SECURITY OWNERSHIP OF CERTAIN      BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER      MATTERS

| Plan                Category                                                                                                                                  | Number                of securities to be issued upon exercise of outstanding options warrants                and rights | Weighted-average                exercise price of outstanding options, warrants and rights | Number                of securities remaining available for future issuance under equity                compensation plans(excluding securities reflected in column (a))                at                beginning of year | Number                of securities remaining available for future issuance under equity                compensation plans(excluding securities reflected in column (a))                at end of                year |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                          | (a)                                                                                                                      | (b)                                                                                        | (c)                                                                                                                                                                                                                         | (d)                                                                                                                                                                                                                   |
| Equity                compensation plans approved by security holders:1996                Equity Incentive Plan1998                Director Stock Option Plan |  104,00025,000                                                                                                      |  $                8.57$13.23                                                          |  71,000-                                                                                                                                                                                                               |  78,000-                                                                                                                                                                                                         |
| Sub                Total                                                                                                                                      | 129,000                                                                                                                  | $                9.35                                                                      | 71,000                                                                                                                                                                                                                      | 78,000                                                                                                                                                                                                                |
| Equity                compensation plans not approved by security holders                                                                                     | -                                                                                                                        | -                                                                                          | -                                                                                                                                                                                                                           | -                                                                                                                                                                                                                     |
| Total                                                                                                                                                         | 172,000                                                                                                                  | $                9.35                                                                      | 71,000                                                                                                                                                                                                                      | 78,000                                                                                                                                                                                                                |

ITEM      13 CERTAIN RELATIONSHIPS AND      RELATED TRANSACTIONS,      AND DIRECTOR      INDEPENDENCE

ITEM      14      PRINCIPAL ACCOUNTING FEES AND SERVICES

----

Part      IV

ITEM      15 EXHIBITS,      FINANCIAL STATEMENT SCHEDULES

| (a)    | Financial                statements and schedule                                                                                                                                                                                            |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |  The                financial statements and financial statement schedule listed under                Item 8                in the index following the cover page are filed as part of this Annual                Report on Form 10-K. |
| (b)    | Exhibits                                                                                                                                                                                                                                    |
|   |  The                exhibits filed as part of this Annual Report on Form 10-K are listed                on                the Exhibit Index below.                                                                                     |

INDEX      TO      EXHIBITS

| *(3)(a)  | Certificate                of Incorporation of the registrant (incorporated by reference to                Exhibit                (3)(a) to Quarterly Report on Form 10-Q for the quarter ended July                3,                2004).                                                       |
|----------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| *(3)(b)  | By-laws                of the registrant (incorporated by reference to Exhibit (3) (b) to                Quarterly Report on Form 10-Q for the quarter ended June 30,                2000).                                                                                                        |
| *(4)(a)  | Specimen                common stock of registrant (incorporated by reference to Exhibit                (4) (a)                to Annual Report for the fiscal year ended September 30,                1994).                                                                                      |
| *(10)(a) | Tech/Ops                Sevcon, Inc. 1996 Equity Incentive Plan (incorporated by reference                to the                Registrant's 2004 Proxy Statement filed on December 29,                2003).                                                                                      |
| *(10)(b) | Form                of Option for 1996 Equity Incentive Plan (incorporated by reference                to                Exhibit (10) (b) to Annual Report for the fiscal year ended September                30,                2002).                                                            |
| *(10)(c) | Form                of Restricted Stock Agreement for employees for 1996 Equity Incentive                Plan                (incorporated by reference to Exhibit (10) (c) to Annual Report for                the                fiscal year ended September 30, 2004).                          |
| *(10)(d) | Form                of Restricted Stock Agreement for non-employee directors for 1996                Equity                Incentive Plan (incorporated by reference to Exhibit (10) (d) to                Annual                Report for the fiscal year ended September 30, 2004).             |
| *(10)(e) | Form                of Indemnification Agreement dated January 4, 1988 between the registrant                and each of its directors (incorporated by reference to Exhibit (10)                (e)                to Annual Report for the fiscal year ended September 30,                1994). |
| *(10)(f) | Directors’                Retirement Plan (incorporated by reference to Exhibit (10) (b) to                Annual                Report for the fiscal year ended September 30, 1990).                                                                                                       |
| *(10)(g) | Board                resolution terminating Directors’ Retirement Plan (incorporated by                reference to Exhibit (10) (e) to Annual Report for the fiscal year                ended                September 30, 1997).                                                           |
| *(10)(h) | Tech/Ops                Sevcon, Inc. 1998 Director Stock Option Plan (incorporated by reference                to                Exhibit 10 to Quarterly Report on Form 10-Q for the quarter ended                March                31, 1998).                                                  |
| (10)(i)  | Summary                of Director and Executive Officer Non-Plan Compensation (filed                herewith).                                                                                                                                                                                    |
| *(21)    | Subsidiaries                of the registrant (incorporated by reference to exhibit (21) to Annual                Report for the fiscal year ended September 30, 2001).                                                                                                                            |
| (23)     | Consent                of Vitale Caturano & Company, Ltd. (filed                herewith).                                                                                                                                                                                                     |
| (31.1)   | Certification                of Principal Executive Officer pursuant to section 302 of the                Sarbanes-Oxley Act of 2002. (Filed herewith)                                                                                                                                             |
| (31.2)   | Certification                of Principal Financial Officer pursuant to section 302 of the                Sarbanes-Oxley Act of 2002. (Filed herewith)                                                                                                                                             |
| (32.1)   | Certification                of Principal Executive Officer and Principal                Financial                Officer pursuant to section 906 of the Sarbanes-Oxley Act of 2002.                (Furnished herewith)                                                                           |

----

SIGNATURES

|   | TECH/OPS                SEVCON,                INC.                 |                             |
|--------|---------------------------------------------------------------------|----------------------------------|
|   |                                                                |                             |
|   | By                /s/                Matthew                Boyle   | December                14, 2007 |
|   | Matthew                Boyle                                        |                             |
|   | President                and Chief Executive                Officer |                             |

| SIGNATURE                                              | TITLE                                           | DATE                             |
|--------------------------------------------------------|-------------------------------------------------|----------------------------------|
| /s/                Matthew                Boyle        | President,                Chief Executive       | December                14, 2007 |
| Matthew                Boyle                           | Officer                and Director             |                             |
|                                                   | (Principal                Executive Officer)    |                             |
|                                                   |                                            |                             |
| /s/                Paul A.                McPartlin    | Vice                President and Chief         | December                14, 2007 |
| Paul                A. McPartlin                       | Financial                Officer                |                             |
|                                                   | (Principal                Financial Officer)    |                             |
|                                                   |                                            |                             |
| /s/                Paul N.                Farquhar     | Vice                President, Treasurer        | December                14, 2007 |
| Paul                N. Farquhar                        | and                Principal Accounting Officer |                             |
|                                                   | (Principal                Accounting Officer)   |                             |
|                                                   |                                            |                             |
| /s/                Maarten D.                Hemsley   | Director                                        | December                14, 2007 |
| Maarten                D. Hemsley                      |                                            |                             |
|                                                   |                                            |                             |
| /s/                Paul B.                Rosenberg    | Director                                        | December                14, 2007 |
| Paul                B. Rosenberg                       |                                            |                             |
|                                                   |                                            |                             |
| /s/                Marvin G.                Schorr     | Director                                        | December                14, 2007 |
| Marvin                G. Schorr                        |                                            |                             |
|                                                   |                                            |                             |
| /s/                Bernard F.                Start     | Director                                        | December                14, 2007 |
| Bernard                F. Start                        |                                            |                             |
|                                                   |                                            |                             |
| /s/                David R. A.                Steadman | Director                                        | December                14, 2007 |
| David                R. A. Steadman                    |                                            |                             |
|                                                   |                                            |                             |
| /s/                Paul O.                Stump        | Director                                        | December                14, 2007 |
| Paul                O. Stump                           |                                            |                             |
|                                                   |                                            |                             |

----

SCHEDULE      II

| Allowance                for doubtful                accounts |   |   | 2007   |   |   | 2006   |   |   | 2005   |   |
|---------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|
| Balance                at beginning of year                   |   |   | 141    |   |   | 144    |   |   | 192    |   |
| Additions                charged to costs and expenses        |   |   | 38     |   |   | 14     |   |   | 73     |   |
| Deductions                from reserves:                      |   |   |   |   |   |   |   |   |   |   |
| Accounts                collected                             |   |   | (11    | )      |   | (10    | )      |   | (8     | )      |
| Write                off of uncollectible accounts            |   |   | (1     | )      |   | (13    | )      |   | (111   | )      |
| Foreign                currency translation adjustment        |   |   | 13     |   |   | 6      |   |   | (2     | )      |
| Balance                at end of year                         |   |   | 180    |   |   | 141    |   |   | 144    |   |