With year-end approaching, two iconic mountain bike brands are making big moves to stay afloat in a difficult market.
Yesterday, Rocky Mountain announced in a press release that it has filed for protection under the Companies’ Creditors Arrangement Act in Canada in order “to avoid business interruption as much as possible.”
“Despite strong demand for its bikes during the pandemic, the Company struggled to secure supplies due to shortages and rising costs,” according to the release. “Once the pandemic was over, the Company had to contend with a sharp drop in selling prices.”
The release continues, “As a result, margins have tightened, putting unprecedented financial pressure on the Company. Rocky Mountain has no choice but to initiate restructuring procedures to launch the Sales and Investment Solicitation Process (SISP) to become a resilient and successful long-term business.” Many bike brands, both large and small, have been similarly affected by oversupply issues and falling margins brought on by the COVID pandemic in 2020.
Rocky Mountain was founded in 1981 by mountain bikers living on the North Shore of Vancouver. In 2021, the brand celebrated its 40th anniversary.
Pon is shelving the GT brand
Also this week, Bicycle Retailer reported that GT Bicycles is “pausing new product releases,” though Singletracks has been unable to independently verify this characterization of the situation. Quoted statements from the brand vaguely point to a “strategic reorientation,” and the publication says GT Managing Director Jason Schiers confirmed that layoffs will be coming to the brand this month.
YouTube personality and GT sponsored rider Phil Kmetz says he and other athletes were included in a call with the brand earlier this week, and his account supports what we’re hearing from other publications.
“They’re not shutting down. They’re gonna sell off the inventory that GT has, and then once that inventory is done, they’re going to pause the brand,” Kmetz said in this video.
GT parent company Pon owns more than half a dozen bike brands, including Santa Cruz, Cervélo, Cannondale, Schwinn, and Mongoose, plus component brand OneUp Components and bike retailer Mike’s Bikes. GT got its start in 1972, and over the years the brand has changed hands before eventually falling under Pon.
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Dec 20, 2024
Dec 20, 2024