RIP Erik Buell Racing
EBR shuts its doors
ERIK Buell Racing looked ready to be a fairy tale success story – a phoenix rising from the ashes of Buell and going on to tie in with an Indian manufacturing giant to secure its future success. But this week the firm closed its doors, shut down its website and began the process to gain court protection from its creditors.
According to the Milwaukee Journal Sentinel, which broke the story, EBR’s debts amount to more than $20 million.
It looks like it could be a sad end for a firm that had all the ingredients for a heart-warming story of success against all odds. It’s previous incarnation, Buell Motorcycles, had been bought-out by Harley-Davidson only to be summarily shut down in 2009 as the financial crisis bit, and H-D decided to focus on its ‘core’ cruiser models instead of the Buell sports bikes. Company founder Erik Buell was prevented from restarting production for at least a year, but was able to secure the rights to much of the machinery Buell had built. As soon as he was allowed to, he announced plans to launch Erik Buell Racing and to start work on a range of new models derived from a prototype that was originally developed to be the successor to the Buell 1125R. The resulting 1190RX was an impressive machine, addressing most of the 1125’s shortcomings.
Soon, enormous Indian firm Hero was on board – buying 49% of EBR in exchange for the technical help that Erik Buell and his engineers would be able to offer when it came to developing new models under the Hero name. A 250cc sports bike developed by EBR for Hero is due to be launched later this year. With the massive financial clout of Hero on board, it seemed that EBR was financially secure, but yesterday’s news reveals that wasn’t the case.
Quite why Hero has allowed EBR to fold remains to be seen; at the moment all that is clear is that the firm’s 126 employees are out of work.
The only glimmer of hope appears to be that the firm is seeking ‘Chapter 128’ protection, an old (1937) law that gives the same protection against creditors as bankruptcy. Unlike bankruptcy, though, Chapter 128 doesn’t write off debts – instead a plan is put in place to help the debtor get back on their feet and pay back what they owe. This suggests that Erik Buell is still fighting to keep his company alive.
