Erik Buell Racing shuts down, files for receivership

In some shocking news for the sportbike industry, the Milwaukee Wisconsin Journal Sentinel is reporting that Erik Buell Racing has ceased operations and filed for receivership protection from creditors. The company that maverick motorcycle designer Erik Buell founded after Harley-Davidson shut down Buell Motorcycle Company in 2009 had been manufacturing a new lineup of V-twin motorcycles using a new engine design, and the company had signed both a race team sponsorship agreement and a minority ownership stake with India motorcycle giant Hero MotoCorp three years ago that gave it a significant cash infusion.

Apparently that cash infusion was subject to some strings attached, and with the company struggling financially as of late with slow bike sales, it's likely that Hero decided to cut off the money pipeline, leaving Buell with no other choice. "The turn we recently took, after we thought we were moving forward, was unexpected," said Buell in a statement. "We thought we had secured funding, but in the end, we were not able to get the funding in place. Therefore we need to do the best we can under the circumstances for all parties in interest."

"To say this setback is a disappointment does not begin to express what I feel right now. I am personally grateful for the support of our outstanding workers, customers and vendors. While this is a sad ending, I personally hope for a new and better beginning," Buell concluded in the statement.

EBR is seeking creditor protection under a Wisconsin state statute that is similar to federal bankruptcy law. At the company's request, attorney Michael S. Polsky will be the court-appointed receiver. And unfortunately in situation somewhat reminiscent of the Buell Motorcycle Company, bids will be solicited for EBR as part of the process, with the winning bid to be determined by the court.

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