The Brammo problem

Back in January, Brammo announced they had sold their motorcycle business to Polaris. Good news for Brammo and a new world for Polaris, but what about the local distributors who may have invested heavily in the brand and are left out of the new deal?

Just over a year ago, WC Distributing announced they’d be bringing the Brammo line into Canada. After January’s news of the sale to Polaris, WC Distributing was under the impression they’d still be able to distribute the Brammo brand for 2015.

But according to Sven Bernard, that hasn’t been the case. In an email to us, Bernard says Brammo tried to get their distributors to purchase machines up until the last minute before the sale, without informing them of the deal in the works. Then, once the sale was announced, Bernard says all communication stopped and no more bikes were available.

He says he was eventually told “Nothing has changed for distributors or dealers and … Polaris will be building the same bike and we will still be selling and supporting the same bikes, just now under the Polaris management.”

That hasn’t happened. Bernard doesn’t blame Polaris for their purchase of Brammo, or hold them responsible for the issues he’s experiencing, but since they already have an existing Canadian distributor, he will not be distributing their battery bike, and as part of the sale deal, Brammo no longer has the rights to produce electric motorcycles.

We also contacted the former Australian distributor of Brammo and got a very similar story. After going to considerable expense to bring the brand into the country (buying spares, tools, test bikes and a race bike) and taking down payments for bikes that Brammo never delivered, they were forced to refund customers their money.

Bernard says the arrangement with Brammo was a bad deal, and that Brammo violated their contract. Adrian Stewart, Brammo’s head of marketing, says that’s not the case. He says the contract provided for eventualities like this, and that the situation is regrettable, but unavoidable.

“I’m afraid it was just inevitable, and not intentional at the start,” Stewart says, “We had another plan, but you have to respond to events, and protect interests of stakeholders.”

Stewart says he understands the frustration Brammo’s former business partners are going through, but that Brammo was unable to make the long-term commitment that would have been necessary to build their motorcycle brand.

In the US, Stewart says, Polaris will review any Brammo dealer that wants to become a Victory dealer and continue selling their electric motorcycles. Some dealers are attempting to go through that process, and others have moved on past the situation. Brammo is also buying back unsold bikes from dealers in the US, as part of their obligations he says.

Stewart says Brammo buyers should actually benefit from the sale, as Polaris will honour Brammo warranties, and the Victory dealer network is much larger than Brammo’s was.
Of course, that’s little good to companies like WC Distributing who are weighing their options, including a lawsuit against Brammo to compensate for their losses, although Bernard says he and fellow distributors don’t expect much satisfaction from such a move, saying “if that comes together, we are sure Brammo will simply close down and reopen under a new name.”