Titan Cycle Files Chapter 11
PHOENIX--The Titan Motorcycle Co. of America has filed for Chapter 11 Bankruptcy, saying that it is “continuing all normal business operations.” On Jan. 17 its stock price hit a year-long low of 3 cents per share.
“Titan wishes to reassure our customers and our dealers that the company will continue to operate without interruption, and Titan remains dedicated to serving our customers’ needs and turning out the high-quality product that customers and the industry has come to expect of Titan, all the while strengthening our ability to provide customers with high-quality service well into the future,” said Frank Keery, Titan’s chairman and chief executive officer. “Protecting the integrity of the Titan brand and the interests of our customers and dealers, and continuing our record of exceptional customer service, remain our top priorities.”
Titan is taking steps to ensure that it will meet its obligations to its essential vendors and suppliers, he said. Keery also noted that “we have requested and expect to receive prompt authorization from the court to continue to pay all salaries, wages, and benefits to our valued employees.”
Recently the company has suffered from “insufficient cash flow to pay vendors timely, resulting in lower than expected materials cost savings and limited potential margin improvement, which in turn resulted in a decline in gross profit margin,” he said.
“This condition affected our ability to maintain the anticipated supply of parts, which further constrained sales,” Keery said. “We have taken appropriate steps to focus corporate management on restructuring the balance sheet to allow Titan to become profitable in the future,” Keery continued. “We believe that our current financial difficulties exist despite a viable core business based on exceptional reputation and products. These difficulties are a short-term problem that can be successfully managed through the reorganization process.
“Once we have completed the reorganization process, we expect Titan to emerge as a stronger company with a sound financial structure,” he said. “The decision to file for Chapter 11 protection was a difficult one, but absolutely necessary in order to protect our ability to meet our obligations to our customers, dealers, suppliers, and our valued employees.”
Founded in 1994, Titan specializes in hand-built motorcycles such as the Gecko, Roadrunner, Sidewinder and Phoenix--along with apparel and accessories. The company’s products are distributed through a network of 61 domestic dealers and 20 overseas operations.
For more information, contact www.titanmotorcycle.com.