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I’m so envious! Even though the engine is new/never been used, it is likely that the coils have failed/cracked. You can inspect them fairly easily by removing the recoil and the little inspection cover over the flywheel. Like everyone says, gear lube, water pump impeller, ignition service.
The important thing to remember about this engine is that is must be mixed at 16:1…. Ignore all the hype about today’s oils being better, which they surely are. But, this engine has plain rod bearings that need all the lube they can get, or they will prematurely wear/fail. The beauty of these engines is that when properly tuned, they hardly smoke at all, even at 16:1… Do you have a pressure tank for it?
Pleasee let me know if you have any questions or need any pieces/parts, I have a basement full of these 58s. Don