More woes for Gibson

[ThirstyMonkey]

I love Les Pauls, but how many versions do we need?--Tribute, Traditional, Standard, Custom, Classic, Special (and those are just off the top of my head). Sad thing is that Gibson has introduced some good guitars over the last few years. Specifically, the Midtown/Midtown Custom. Good looks, great player, priced right (under $1,500). But then they don't know how to market them ("Richlite" fingerboards, c'mon) and they get lost in the mix, and eventually discontinued.

 

[2F/2F]

PLEKs are theoretically great, when used by a responsible and prideful manufacturing operation. They take a lot of the time consuming coarse "grunt" work out of fret and nut shaping (and other jobs), and are more consistent and accurate at doing this. Then, theoretically, a human being can come in and put a better effort and more time into the precise fret crowning, end dressing, and polishing, and the nut detailing, that make all the difference between a mediocre playing neck and a great playing neck. Saves labor costs on the most "robotic" aspects of fret and nut work, and because of this, theoretically gives the craftspeople more time to devote to this fine finish work, as well as potentially higher productivity.

...in theory.

In practice, many manufacturers view the PLEK as all you need, and use it as an excuse to simply speed up production *and* reduce their workforce, by reducing human attention to the finer details. Looking at the frets and nuts on Gibson guitars, it is obvious that this is how they view the PLEK. That said, they skimped similarly in these areas even before the PLEK. The PLEK simply allowed them to have a robot do the crappy (or, better stated: "incomplete") fretwork as opposed to a person.

A company like Heritage is exactly the type of company that could greatly benefit from the use of a PLEK. I would expect them to have the pride and the technical understanding of fret and nut work to use a PLEK appropriately. It could help them greatly. How ironic that they, of all companies, have a contingent rejecting it.

 

[engedi1]

Just ran across [Invalid or Expired Link Removed] short article that mentions KKR Credit Advisors has broken off debt restructuring negotiations with Gibson. The reason is a disagreement over the valuation of Henry Juskiewicz and Dave Berryman’s holdings for purposes of a debt to equity swap.

For those who don’t know, that basically means stockholder(s) can relinquish some (or all) of their shares in exchange (or to pay down) bonds or credit notes owed. Or (in some cases) a company can issue additional stock shares which dilutes the value of the shares already issued. That’s not something that sits well with existing stockholders since you’re reducing the value of their shares to pay bills in a classic “other people’s money” manner. In any event it also gives the new shareholders a say in running the company, whether by them acquiring existing shares, or newly issued voting shares.

Apparently Henry is either still hoping for a miracle, or he simply can’t conceive of a future Gibson without himself at the helm and having the final word on everything. So as of now, a post restructured Gibson sans Henry as an absolute monarch (or more likely without Henry at all) is what’s most likely going to happen.

I’m guessing Gibson is headed for completely new ownership come July. The core business itself is profitable so I doubt Gibson is going to disappear or stop making guitars. But I’m guessing a far more agile and reality-based existence lies in the future for the name Gibson.

My feeling is it can only be a good thing at this point.

excellent. totally agree with all you said

 

[MojoPenguin]

Imagine if Fender were to buy Gibson in July...

 

[gln1955]

I love Les Pauls, but how many versions do we need?--Tribute, Traditional, Standard, Custom, Classic, Special (and those are just off the top of my head). Sad thing is that Gibson has introduced some good guitars over the last few years. Specifically, the Midtown/Midtown Custom. Good looks, great player, priced right (under $1,500). But then they don't know how to market them ("Richlite" fingerboards, c'mon) and they get lost in the mix, and eventually discontinued.

That all sounds a lot like Fender, too.

 

[veebass]

Well I know Australia is a relatively small market, but I have to wonder about a company whose importer imports nothing for over a year, including high volume selling Epiphones.

 

[40Hz]

my favorite bit was 'escape goated'

Yeah. A new coinage, perhaps? That one stopped me cold for a second. But I like it.

 

[yodedude2]

i thought, hey, great band name! so i checked...yeah, there are about a half-dozen 'escape goat' bands out there already.

 

[40Hz]

Imagine if Fender were to buy Gibson in July...

I can’t imagine how they could afford to even if they wanted to. I say this because they’re having their own financial issues (which to their credit they’re handling far better than Gibson is) and I can’t see anybody providing the financing they’d need to buy Gibson in light of that.

But even if they had the money, their whole product philosophy, design, and signature sound is pretty much the polar opposite of Gibson’s. Fender and Gibson have had a (mostly) friendly rivalry since the first Broadcasters and Esquires waltzed out the factory door in Fullerton back in 1950. Owning Gibson would get Fender nothing they need. Any of Gibson’s acquisitions will be sold off by its creditors if they take over, so all Fender would be buying is an instrument company that directly competes with everything Fender does and stands for. So with cultural incompatibility like that, I don’t think a Fender/Gibson umbrella company is in the future.

Regulators might also be concerned since a combined Fender-Gibson would own something like +90% of the market overnight, and concerns about effective control of an entire industry by one company could be enough to block approval of it as well.

So I can’t imagine a scenario where Fender swooping up Gibson is ever going to happen.

But it is an intriguing hypothetical. Makes you wonder what the US music market would be like in the wake of something like that…

 

[klejst]

I've said it before and I'll say it again and probably again, I don't feel sorry for them and no one to blame but themselves.

 

[Mvilmany]

I just want a handmade in USA guitar, made from old growth mahogany, maple, and Brazilian rosewood. Is that too much to ask for? Hahaha... yeah I know that it is.

As far as the Brazilian rosewood goes, I think Sadowsky still has a few pieces left.

 

[wmhill]

The spelling and the familiar shapes remain, other than that, Gibson's already been gone for years...

 

[ctmullins]

I just want a handmade in USA guitar, made from old growth mahogany, maple, and Brazilian rosewood. Is that too much to ask for? Hahaha... yeah I know that it is.

Lots of small builders can do that for you, with better quality at a better price.

(Also, why exactly do you require Brazilian rosewood, as opposed to other species of Rosewood? )

 

[Boundary Effect]

oh wow. i had long thought of Heritage as the 'real' gibson. thanks for the link, but such a sad story.

That is a bummer. I grew up near Kalamazoo, as a teenager got a BJ in my car parked at 225 Parsons and now own a Heritage HB1 bass. ProCo is another Kalamazoo company, use to be a music store. And the owner, Charlie Wicks, gave me the builder plans for a TL606 back in spring 1977.

 

[Ross W. Lovell]

Just ran across [Invalid or Expired Link Removed] short article that mentions KKR Credit Advisors has broken off debt restructuring negotiations with Gibson. The reason is a disagreement over the valuation of Henry Juskiewicz and Dave Berryman’s holdings for purposes of a debt to equity swap.

For those who don’t know, that basically means stockholder(s) can relinquish some (or all) of their shares in exchange (or to pay down) bonds or credit notes owed. Or (in some cases) a company can issue additional stock shares which dilutes the value of the shares already issued. That’s not something that sits well with existing stockholders since you’re reducing the value of their shares to pay bills in a classic “other people’s money” manner. In any event it also gives the new shareholders a say in running the company, whether by them acquiring existing shares, or newly issued voting shares.

Apparently Henry is either still hoping for a miracle, or he simply can’t conceive of a future Gibson without himself at the helm and having the final word on everything. So as of now, a post restructured Gibson sans Henry as an absolute monarch (or more likely without Henry at all) is what’s most likely going to happen.

I’m guessing Gibson is headed for completely new ownership come July. The core business itself is profitable so I doubt Gibson is going to disappear or stop making guitars. But I’m guessing a far more agile and reality-based existence lies in the future for the name Gibson.

My feeling is it can only be a good thing at this point.

This is the problem with people like Henry.

He screwed up, big time, and refuses to take any accountability.

Clearly, if you are looking to finance this deal and the enormous debt that goes with it, the last thing you want to do is let the guy who is responsible, use your money to finance a "do-over". Not what I would call a smart investment move.

Mr. J likely has all sorts if "conditions" regarding his future. Pulling this off, meaning getting Gibson back on track and dealing with that debt will be a monumental undertaking and dealing with Henry's personal demands just shows you how delusional he still is at this time.

Henry will NOT be part of any deal, and if he is, it won't last long.

 

[pcake]

henry has been at gibson WAY past when he should have left or been removed. some stockholders seemed to be so grateful to him for pulling the company back together back when (i believe it was the '80s) that they just kept backing him no matter what he says or does.

i love gibson products - and i really love their newer acoustics, particularly the J15 - but the zillions of different les paul models are A) cannibalizing their own sales and B) some (like the roboguitar) were a very poor call for a larger release. i used to be buddies with a sam ash store acoustic guitar manager, and gibson forced them to take a bunch of robo les pauls, which ultimately took up a lot of store real estate and very, very rarely sold, but henry was sure the technology would take off and was pushing it hard. if never did. not to mention that the constant renaming of the acoustics confuses pretty much everytone, too.

henry also helped cause that entire rosewood thing by the rude way he treated the authorities, and some of the smaller stores around here have been treated very poorly by gibson reps for no reason at all. it seems to me that henry's arrogant, rude way of doing business has trickled down.

besides, why were they buying electronics companies? don't expand unless you can afford it, and after those fines, i wouldn't have thought it was time to make large purchases.

in my perfect world, the board would forcibly remove him and find someone who loves musical instruments and has a clue about business.

 

[Deleted member 165050]

My money's on Uli Behringer's Music Group to acquire Gibson. He's already snapped up Midas, TC Electronic, and Klark Teknik to name but a few, and saved those companies from folding. He might come in for a lot of criticism but he'd probably turn Gibson round *and* keep high-end production in the US...

 

[lpbfender]

They wont be gone, but I would guess they wont be the same. To create great musical instruments takes management that is passionate about musical instruments. Investors and accountants care nothing about the quality of the products they produce. They only look at the numbers

Well happened at Fender when CBS in the 80’s

 

[Neon Blues]

I can't find the article to back it up but I heard that Ibanez were in talks of purchasing Gibson. Moving all standard models to their factories and keeping the Gibson Custom Shop as it is.

 

[Ross W. Lovell]

My money's on Uli Behringer's Music Group to acquire Gibson. He's already snapped up Midas, TC Electronic, and Klark Teknik to name but a few, and saved those companies from folding. He might come in for a lot of criticism but he'd probably turn Gibson round *and* keep high-end production in the US...

I wish, those were reasonably small companies with little debt if I remember correctly?