Touratech files bankruptcy

Article

...does not surprise me considering the sky high prices they have for their accessories and perhaps the spiraling overhead expenses...

On a positive note, the article does say:

Touratech -USA, the US importer, is an independently owned US company and is in good financial condition and will not be impacted by the restructuring in Germany.

RB

Bummer. Just ordered some replacement parts for
A Touratech skid plate. I am sure they will arrive. Hope they do survive.


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If the skid plate is being shipped from their US distribution center, I think there should be no delay.

According to this source, the reason for the sudden corporatate restructuring is due to:

Delays in the construction of a new logistics center needed to meet increased product demand. The delay reportedly led to losses in both production and supply, which created the filing for insolvency. - source

...it sounds like they need to "Amazonify" their supply chain.



RB

Wait a minute.... If TT-USA is the US distributor of TT-Germany's products, are they not dependent on TT-Germany for their product and thus their revenue stream? How can that NOT affect them? Unless they sell product other than the parent supplier.

It's just a financial restructuring in Germany. Production on parts made in house continues (per the announcement) and all of the parts they sell from outside suppliers would still be available to the US company. Companies file bankrupcy all the time. Not sure why it's noteworthy.

Filed for insolvency, not bankruptcy. Huge difference.

tricepilot said:

Filed for insolvency, not bankruptcy. Huge difference.

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They did file bankruptcy technically...but the milder variant that involves restructuring their debt obligations...

Touratech has good but very expensive products compared to other aftermarket alternatives hence margin compression shock. They also have implemented a poor strategic financial plan. I think Touratech and their massive catalog offering became over-committed to the manufacturing resources and they tried to sell specialty items that were not in demand and as a result the cost burden of trying to support many, many products for a wide range of bikes...resulted in their current mess.

Anyway, although EU laws are different than the US, their move is basically a Chapter 11 Bankruptcy or rehabilitation bankruptcy as some bean counters are fond to call it. Chapter 11 tends to be more involved than Chapter 7, as it allows Touratech the opportunity to reorganize its debt and to try to re-emerge as a healthy organization. And yes, Chapter 7 is a different type of bankruptcy that involves liquidation of the company assets in order to pay creditors.....bondholders, investors..etc.

...by the way, there is a smokin' deal for a BMW GS skidplate at a deep discount of $3,000 USD on the Touratech web site...however Wunderlich has the same version listed at $4,200 USD.



RB

Tom Crean on ADV summarized it best (similar thread title over there):

"Also you should update the thread title. Insolvency does not mean bankrupt. Filing for protection in the courts due to insolvency is done to give time to investigate how they can refinance, restructure their debts and operating costs to return to solvency and continue in business. It's a serious situation but creditors can't progress with an application to have Touratech declared bankrupt while the defined period of protection is in effect.

Basically, it can go either way. But they're not bankrupt, not at this time."

tricepilot said:

Basically, it can go either way. But they're not bankrupt, not at this time."

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Chapter 11 bankruptcy, debt obligation restructuring, financial rehabilitation....basically all point to poor cash flow management and supply chain bottlenecks.

I wish the folks at Touratech best wishes during this challenging time. The company is an incredible Germanic entrepreneurial success story - started by two guys around a coffee table back in the early 1990s (reminds me a little of Rod Canion @ Compaq Computer origin story). They employ several hundred people in a small German town of Niedereschach for most of their operations. Their workmanship is typical Teutonic quality which is synonymous with durability.

Touratech did an outstanding job at exploiting the European accessory market for motorcycles. Like many small companies undergoing the initial hyper-growth phase, it is challenging ramping up operations to the next level of maturity of sustained growth. I believe they tried to serve to many models and options through their catalog offerings.

Their MASSIVE 400 page plus catalog was probably quite expensive to print and generate too. Like the outdated "Sears" catalog, shoppers are using the online portal as a conduit to facilitate business to consumers transactions.

...if Touratec continues to reduce unneeded costs/expenses, improve customer support processes, enhance product fulfillment, and focus on the top revenue brand channels growth areas, I think Touratec will be fine.

Touratec has valueable IP & branding assets as well...perhaps BMW AG or another related larger brand could be a potential business suitor if things don't pan out for Touratech....



Onward and upward,

RB

I'm curious as to what this means going forward for the iconic factory cases for the R1200GSA. They are manufactured by Touratech.

kurt said:

I'm curious as to what this means going forward for the iconic factory cases for the R1200GSA. They are manufactured by Touratech.

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IF Touratech should file Chapter 11 liquidation, BMW AG would probably purchase the design/utility patents directly from Touratech. BMW could easily go to a competitor live GIVI and request replicating the look and feel of the original Touratech design and robustness.

I think GIVI makes most OEM top and side cases for Japanese bikes.

I hope it won't come down to that....

RB