Tell me this is late April Fools

[Scott]

Its a sad day. American Superbikes owned by India just does't have the same ring. IF HERO were buying Erik out there would no need to suspend operations and fire the staff, you simply do the transaction and pencil in Inc or Subsidiary on all the signage. Not over think it since we don't have many facts but:

They suspended operations, and closed firing the staff.

Instead of going chapter 11 they go WI Chapter 128 which is more like a protective order against being sued and shelter from additional interest from creditors until you can pay them off. Under 128 they could have kept the staff and continued supporting dealers and customers but didn't which makes me think its way more grave a situation than just a restructure.

The sudden lack of funding large enough to overthrow an operation like this is either GE or Hero.

If its was GE that means they don't have enough to pay the suppliers which is why we seem to always see parts out of stock. In which case some may be able to rescue them and operation MIGHT resume ( they didn't have to close for this scenario though).

If its HERO, that's a major problem as the principle investor pulling out would leave Erik having to fund operations and pay off debts himself (as before.) Seeking chapter 128 buys him 36 interest free months to pay off creditors by selling off company and personal assets. In that scenario its turn off the lights and shut off the ac and only eat Roman noodles while we figure a way out of this without loosing the house...

The one thing I feel sure of is something very specific and very planned is going on. I also feel nearly as certain that bikes will continue to get made relatively soon (the real value here - and there is value - isn't in the equipment or buildings or office furniture, it's in the specific designs and road-legal bikes that can be made and sold using existing equipment).

As you mention, if Hero intends to just continue with Erik in a diminished role, it doesn't seem like they'd go about it this way. They'd buy Erik out (and while he may have been reluctant to sell, if it was the difference between shutting the doors or allowing Hero to continue, I don't think he'd take the company down with him) and it would be a lot cleaner and neater than this without the negative press, and the transition would be nearly invisible. If the company goes on the market and Hero intends to get it back, they take the risk of losing it or paying more than they likely could have by making a simpler offer to Erik.

Hero wants to get into the US market. The worst thing they could do with that clear goal in the near future would be to screw over an iconic figure in American motorcycling while also pissing off a lot of great dealers (like AF1) who could sell the crap out of Hero motorcycles. The value of those relationships has to be higher (though difficult to quantify) than the few million dollars at stake with keeping EBR running.

I can't think of a logical explanation for what's happening, but it has to be there.

If you go to EBR's web-page, it will say: "It works!

This is the default web page for this server.
The web server software is running but no content has been added, yet."

If they were simply turning off the lights, it seems like the old web-page would stay up for many months until the bill eventually came due.

There's something going on and management and communication people are involved. We saw what Erik did when Harley pulled the plug. If EBR were just turning off the lights, I suspect he would have more to say than we've heard. The silence in itself is very telling and I suspect Erik would love to come out and say what's really happening, but his hands are tied by legal restrictions.

While I'm very baffled by what's actually going on, If I had to bet, I'd say that things will continue in some way and the damage to employees, suppliers and dealers will be minimized as much as possible (not to say there won't be transition and pain).