Are the Days of Briggs & Stratton Engines in Mini-Bikes Over?
Most people know about Briggs & Stratton, the small engine company. Well, it seems that the company has filed for chapter 11 bankruptcy. As someone who loves minibikes and these little engines, it makes me very sad.
According to the Milwaukee Journal-Sentinel, the small engine manufacturer has been in business for over 100 years. It has sold products in more than 100 different countries, and it has primarily focused on outdoor power equipment, but all of us motorcyclists know that the company stuck reliable little 5 hp (or different power outputs) inside little mini-bike frames.
At one time, Briggs & Stratton was the largest small engine manufacturer in the world. The company sold over 125 million engines over the course of more than a century in business. As of the 2019 fiscal year, Briggs & Stratton had $1.8 billion in revenue and employed around 5,251 people companywide. It also employed numerous contract workers in 2019.
So, why the bankruptcy? Well, sales had been falling even before the COVID-19 pandemic. The company saw losses of $54.1 million in its 2019 fiscal year and $11.3 million in its 2018 fiscal year. It was also sitting on a big ole heap of debt. The engine manufacturer had short-term debt of $597.5 million and long-term debt of $7 million as of March 31, according to the Milwaukee Journal-Sentinel. Bloomberg reported that to total debt for all of the creditors that Briggs & Stratton owed to through its various branches of business totaled more than $1 billion.
The original plan was to sell off portions of the business and become a smaller and more efficient one (Harley-Davidson may have to do the same eventually). Instead of doing a less than elegant downsizing over a few years, now it will happen through bankruptcy.
With bankruptcy in progress, a New York private equity firm KPS has stepped in to buy all of the company’s assets for $550 million. It will also keep the business going while it goes through the bankruptcy process. KPS is also working with the United Steelworkers of America to come up with a new deal for Briggs & Stratton that will impact employees. Also, cash retention awards went to key executives, including $1.2 million for Chairman, President and CEO Todd Teske, and $600,000 for Chief Financial Officer Mark Schwertfeger.
Sad to hear, they are excellent engines, can take a beating 🙂
I remember years ago having the paper stock certificates of Briggs & Stratton and looking forward to the quarterly dividend checks. The ‘good ole days’ are gone forever.
Sad to here, only because they used to be about quality (pre 2000), now its all considered throw away, plastic parts, plastic internals.
Sad, executives drain money off a sinking ship. They (executives) drain off the company, with total disregard for anyone else. Capitalism at it’s best.
This is very sad and goes way, way beyond our myopic look at mini-bikes. B&S makes engines for a huge variety of motorized products in America, from providing Husqvarna with engines for mowers and lawn tractors, to providing many other companies with powerplants that functioned in everything from generators to power washers.
This is really going to affect a lot of industries if it goes fully pear-shaped.