Messy cables, any idea what these are for?
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I would like to re-wire the circled cables if possible, just to tidy it up, looks terrible at the moment. I'm just unsure what the cable is for and why there is that stubby end piece cable tied and taped to it.
Is it perhaps for the neutral light on the dash? That isn't working anyway, so maybe nothing to loose here?
Link to large image here: http://tinypic.com/r/1498txx/9
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Those cables go from the stator / generator to charge the battery and power the bikes electrics. You can just remove the engine cover and make the cables look a bit nicer by maybe re-covering them with electric tape? As for the stubby piece, not entirely sure from this pic. Could be neutral wires, in which case they should route underneath your sprocket into the side of the engine on the end of a small plastic bolt.
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I'll follow the stubby end cap further and see where it goes.
If I take the engince cover off is there any trick to getting it back on? does it need to be sealed with silicone or something when I put it back?
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I think it should have a gasket on it, but depending on how old it is, it might not seal very well when you put it back on. In which case it's not the end of the world as it doesn't need to be perfectly sealed, but just needs to be protected from the rain and mud etc. Maybe purchase a new one on eBay and just replace it when it arrives.
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You can buy generic gasket paper to reseal that. Although as said it's the generator so I wouldn't want water getting in there.
Also the pickup is in there also. The pickup is used to tell the spark plug to fire, I'd leave those cables alone if you don't know what they do mate. Otherwise you're going to end up with all sorts of firing issues.