After a month of negotiating, it’s official. The Indian
Motorcycle brand has been sold for an undisclosed amount to
Stellican Ltd., a British firm that specializes in restoring
classic but distressed companies.
Indian’s liquidation broker, Credit Managers Association of
California, confirmed the news Monday.
GILROY –– After a month of negotiating, it’s official. The Indian Motorcycle brand has been sold for an undisclosed amount to Stellican Ltd., a British firm that specializes in restoring classic but distressed companies.
Indian’s liquidation broker, Credit Managers Association of California, confirmed the news Monday.
For Bill Lindsteadt, executive director of the Gilroy Economic Development Corporation, that means it’s time to kick into gear on convincing Stellican officials that the best place to restart production here in Gilroy, where Indians were made from 1999 to 2003.
This city’s skilled motorcycle-making workforce and vacant factory building are two strong drawing cards, Lindsteadt said, and he also plans to get the City Council’s cooperation in offering Indian a tempting reduction in development impact fees.
“I do consider myself a pretty good salesperson,” he said.
“We haven’t ruled it out,” Stellican partner David Wright, of Sarasota, Fla., said of building bikes in Gilroy. “It’s frankly too early in the process to have any … decisions made. … We haven’t had time to carefully review any of our alternatives at this time.
“Obviously, we made the investment, and the business has to be located somewhere,” he added. “I’ve been running around for a month, as has (Stellican founder) Stephen (Julius), trying to acquire the brand. … That has taken the lion’s share of our attention.”
The deal was closed late last week, Wright said. Now Julius and Wright are switching gears, and Wright said they will be “thoughtful” about deciding where and when to build new Indians, how many to build, what engine technology to use and how to organize the network of dealers.
“We are long-term brand-builders, obsessed with product design and quality,”
Julius said in a prepared statement.
Stellican’s most recent success is Chris-Craft motorboats, which it bought in 2001 after the boat-builder went bankrupt the year before. It has also owned an Italian luxury yacht company, an Italian soccer team, a Spanish soft drink producer, an Italian money-exchange bureau and two Italian cash register makers.
Indian, “America’s first motorcycle,” began in 1901 in Springfield, Mass. and competed head-to-head with Harley-Davidson for control of the U.S. market before stopping its U.S. production in 1953. It was reborn in Gilroy in late 1998 and built bikes here until Sept. 19, 2003, when it closed without warning, despite rising sales numbers. Indian laid off 380 employees when it folded. At its peak, it employed some 600 people.
One thing the Indian comeback in 1998 proved was that it remains a recognizable and desirable brand, and many have said it is the only U.S. motorcycle brand that can rival Harley in the heavy cruiser market.
Julius and Wright visited Gilroy several weeks ago “to try to understand what had transpired” with Indian’s last incarnation, Wright said. While here, they walked around the outside of the vacant factory and talked with a some former employees. Wright called it “intelligence gathering.”
“I was not aware that they were here,” Lindsteadt said. “I would love to have met them in person.”
So far, Lindsteadt and Wright have only traded e-mails.
“I think I could say that we certainly appreciate the role that the city of Gilroy has played in the development of Indian Motorcycle, and we will give it due consideration,” Wright said. “There’s just a lot of variables in the equation, and you have to take the time necessary to assess those variables.”
Gilroy’s chances of keeping “America’s First Motorcycle” appeared slim Saturday, when a report in the British-based Financial Times quoted Julius as saying his firm would begin construction of a new Indian manufacturing facility somewhere in the U.S.
Wright, however, said this was inaccurate. No decision has been made whether to build a new plant or move into an existing one, he said.
While building a new factory wouldn’t rule Gilroy out, California’s comparative lack of industrial perks would hurt its chances, according to Lindsteadt and George Nobile, Indian’s former vice president of service.
In states such as Alabama, South Carolina, Texas and Nevada, cities offer more incentives to build, according to Lindsteadt and Nobile. Both men said they know of cases where cities offered industries free land and free buildings to attract their jobs.
“We just can’t do that here,” Lindsteadt said. “We’ll do everything we can, but there are some pretty competitive cities out there.”
Gilroy’s economic incentive program offers to waive development impact fees of $4,000 per job during a three-year startup period, according to Lindsteadt. The city, however, is in the middle of planning to raise its utility and traffic impact fees.
Nobile said Gilroy will have to “bend over backwards” to lure Indian back.
“I think Gilroy would have to be really aggressive, really quick to get them,” Nobile said. “These guys are businessmen, … so if it makes good business sense to go to Gilroy, they’ll do it.”
