Gibson, an iconic American guitar manufacturer, has filed for bankruptcy.

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OzarkTom

http://money.cnn.com/2018/05/01/news/companies/gibson-guitars-bankruptcy/index.html

Sorry to hear this.  Vintage Gibson guitars will probably be even more expensive.

orientalexpress

I’m not surprise ,guitars is not as popular like before ,kids have no guitar god to look up to .

SteveFord

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With any luck they can shed the Gibson Lifestyle companies and just go back to making guitars like they should have done in the first place.

JerryM

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With any luck they can shed the Gibson Lifestyle companies and just go back to making guitars like they should have done in the first place.

This.

Folsom

Does it really matter? There's more than enough guitar makers out there these days.

dB Cooper

Well, it certainly matters if you happen to work for Gibson.....
Sad to see an iconic American brand struggling.
Young people don't seem to listen much to guitar oriented music anymore. Everything is soulless, electronically generated crap that sounds like a washing machine with an unbalanced load. I know my parents thought the same thing about my music, but a lot of it (certainly not all) has stood the test of time. There are fewer people taking up the guitar (or pianio, or etc etc etc) because it requires effort to learn- if it was easy, everybody would be doing it. Everything the young people listen to today comes out of GarbageBand or its ilk.

Hope Gibson survives.

wushuliu

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They’ll get bought up by some hedge group or conglomerate and the quality will drop like a rock with cheaper prices just like so many other brands. The brand name is too valuable, someone will snatch them up. This has nothing to do with sales. It’s just another victim of creative financing that runs its course. Look at guitar center.


FullRangeMan

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Well, it certainly matters if you happen to work for Gibson.....
Sad to see an iconic American brand struggling.
Young people don't seem to listen much to guitar oriented music anymore. Everything is soulless, electronically generated crap that sounds like a washing machine with an unbalanced load. I know my parents thought the same thing about my music, but a lot of it (certainly not all) has stood the test of time. There are fewer people taking up the guitar (or pianio, or etc etc etc) because it requires effort to learn- if it was easy, everybody would be doing it. Everything the young people listen to today comes out of GarbageBand or its ilk.

Hope Gibson survives.
+1. His products were expensive low sales, they refused to enter the low priced market.

wushuliu

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Well, it certainly matters if you happen to work for Gibson.....
Sad to see an iconic American brand struggling.
Young people don't seem to listen much to guitar oriented music anymore. Everything is soulless, electronically generated crap that sounds like a washing machine with an unbalanced load. I know my parents thought the same thing about my music, but a lot of it (certainly not all) has stood the test of time. There are fewer people taking up the guitar (or pianio, or etc etc etc) because it requires effort to learn- if it was easy, everybody would be doing it. Everything the young people listen to today comes out of GarbageBand or its ilk.

Hope Gibson survives.

So not true. Pull up youtube and look up the many boys and girls across the globe shredding their axes. Walk into a guitar center and there are always people checking out guitars. You make it sound like everyone played in the ‘old days’. Guitars are ever popular but always been a small market. And Gibsons are expensive. So you’re not really talking about these darned kids. You’re talking about midlife crisis men who suddenly no longer have the urge to plink down 1000 plus. Got nothing to do with the younger generation.


dB Cooper

So not true. Pull up youtube and look up the many boys and girls across the globe shredding their axes. Walk into a guitar center and there are always people checking out guitars. You make it sound like everyone played in the ‘old days’. Guitars are ever popular but always been a small market. And Gibsons are expensive. So you’re not really talking about these darned kids. You’re talking about midlife crisis men who suddenly no longer have the urge to plink down 1000 plus. Got nothing to do with the younger generation.

https://www.washingtonpost.com/graphics/2017/lifestyle/the-slow-secret-death-of-the-electric-guitar/?utm_term=.cbd5e5c1747f

OzarkTom


Folsom

I thought guitars were more popular these days... btw.

FullRangeMan

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Maybe their troubles with the government in 2011 had something to do with this.

https://www.npr.org/sections/therecord/2011/08/31/140090116/why-gibson-guitar-was-raided-by-the-justice-department
I thought Gibson plants their woods, as they advertised in the 90's in Guitar Player.

mix4fix

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https://www.nationalreview.com/corner/gibson-ceo-slams-big-liberal-obama-robert-costa/

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Henry Juszkiewicz, the chief executive officer of Gibson Guitar Corp., tells National Review Online that President Obama, a “big liberal,” has done “untold damage to business” and should not be applauded for his jobs speech. ”He’s a government fan,” he says. “He has a problem with successful businesses. He thinks they’re the problem, that they shouldn’t be quite as successful.”

“He is using the levers of government to not only redistribute, but to penalize,” he adds. “I see a difference between what he said and what he’s doing.”

Gibson has been under federal investigation in recent months, reportedly for its importation practices. Juskiewicz blames the Obama administration for causing his company, an iconic American brand, to lose money and lawyer up.

“We’re under attack,” Juskiewicz says. “It’s pretty interesting to see that one of the points in Obama’s speech was to cut back regulation and promote jobs, when, in fact, he’s done just the opposite with us. We have been under investigation and harassment for over two years and that continues on — seized goods, shut down our plant.”

No American laws were broken. It was political.

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One of Gibson’s leading competitors is C.F. Martin & Company. The C.E.O., Chris Martin IV, is a long-time Democratic supporter, with $35,400 in contributions to Democratic candidates and the DNC over the past couple of election cycles. According to C.F. Martin’s catalog, several of their guitars contain “East Indian Rosewood.” In case you were wondering, that is the exact same wood in at least ten of Gibson’s guitars.

If two companies use the same materials from the same place, how is one bad and the other isn't?

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After: spending nearly two and half million dollars in legal fees: and: paying a $300,000 fine, the government has settled with Gibson and has finally returned the confiscated tonewood.

They had to waste $2.5 million in legal fees, a $250K fine, and a forced $50K to pay off some environmental group in order to get their wood back a couple of years later.
« Last Edit: 2 May 2018, 05:50 am by mix4fix »

wushuliu

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https://www.nationalreview.com/corner/gibson-ceo-slams-big-liberal-obama-robert-costa/

No American laws were broken. It was political.

Bwahahaha. Literally blaming Obama for Guitar company failure. That's hilarious.

Now back to reality:

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Gibson Brands Inc. filed for bankruptcy with a turnaround plan that will give some of the company's lenders equity ownership

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The change in control will give noteholders equity in a new company, replacing current stockholders such as Chief Executive Henry Juszkiewicz. According to court filings, current noteholders include Silver Point Capital, Melody Capital Partners LP, and funds affiliated with KKR Credit Advisors. The restructuring will also allow the instrument business to "unburden" itself of a consumer-electronics unit that Gibson blamed for its financial woes.

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Its Gibson Innovations business, acquired in June 2014 from Koninklijke Philips NV, was the source of its financial woes, according to a court statement from Brian J. Fox, a managing director at Alvarez & Marsal who will serve as the company's chief restructuring officer. Acquired through a leveraged transaction, the business faced significant sales declines due in part to a loss of credit insurance overseas.


Sounds to me like Gibson had some other murkier issues related to its current 'restructuring' and acquisition by noteholders. Just like Guitar Center, etc. So like I said, Gibson isn't going anywhere. Money and debt are just changing hands, product will be compromised, consumers probably screwed. They're just doing what a lot of others are doing.

mix4fix

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I don't trust the government to do the right thing. Just look at how the I.R.S. was used as a political tool.

If one company get's punished while another doesn't for doing the exact same thing, it raises a big red flag. Either they both broke the law or neither broke the law. I don't have anything vested either way. I expect continuity. I say let them use the wood.

Shutting you down, confiscating your supplies-n-inventory, having you spend unnecessary funds to get them back years later will have an effect on your business. That's two years of current, future, and lost sales as well as hurting your reputation.

wushuliu

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https://www.washingtonpost.com/graphics/2017/lifestyle/the-slow-secret-death-of-the-electric-guitar/?utm_term=.cbd5e5c1747f

Like I said middle aged dudes who don't have the $$$$ to plunk down on expensive gear. Guitar sales are lower than a decade ago and a decade ago I'm sure they were lower than the decade before. ALL of retail is undergoing a massive sea change with big sales and revenue drops, be it Gibson or Sears or Toys R US. The PRS guy seems to get it:

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“This is a very complicated mix of economy versus market, demand versus what products are they putting out, versus are their products as good as they used to be, versus what’s going on with the Internet, versus how are the big-box stores dealing with what’s going on,” Smith says. “But I’ll tell you this: You put a magic guitar in a case and ship it to a dealer, it will sell.”

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Then there’s Henry Juszkiewicz, the biggest and most controversial of the music instrument moguls. When he and a partner bought Gibson in 1986, for just $5 million, the onetime giant was dying

Almost went down in '86. What was their excuse then? Run-DMC torpedoed their sales?

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There’s also the line of self-tuning “robot” guitars that Gibson spent more than a decade and millions of dollars developing. In 2015, Juszkiewicz made the feature standard on most new guitars. Sales dropped so dramatically, as players and collectors questioned the added cost and value, that Gibson told dealers to slash prices.

Self wha? Doesn't sound like a consumer problem, sounds like a management problem.

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Journey’s Neal Schon says he battled with Juszkiewicz when he served as a consultant to Gibson.

“I was trying to help Henry and shoo him away from areas that he was spending a whole lot of money in,” Schon says. “All this electronical, robot crap. I told him, point blank, ‘What you’re doing, Roland and other companies are light-years in front of you, you’ve got this whole building you’ve designated to be working on this synth guitar. I’ve played it. And it just doesn’t work.’ And he refused to believe that.”

Points for 'electronical'.

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Juszkiewicz says that one day, the self-tuning guitars will be recognized as a great innovation, comparing them with the advent of the television remote control. He also believes in the Philips purchase. Eventually, he says, the acquisition will be recognized as the right decision.(6/2017)

M'kay. I think that says enough.

wushuliu

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I don't trust the government to do the right thing. Just look at how the I.R.S. was used as a political tool.

As evidenced above, politics has nothing to do with Gibson's problems. Unless you're saying the government should invest in in ROBOT GUITARS. Dangerous technology. Think of the consequences, man!

mix4fix

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As evidenced above, politics has nothing to do with Gibson's problems. Unless you're saying the government should invest in in ROBOT GUITARS. Dangerous technology. Think of the consequences, man!

It definitely was a piece of it. I wish it wasn't so it can solely be a management problem.

Government shouldn't be investing in things.

I don't know what a robot guitar is, but, since everything is going technology (self-checkouts, etc), I wouldn't be surprised.

wushuliu

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It definitely was a piece of it. I wish it wasn't so it can solely be a management problem.

Robot. Guitars.