Gibson to Move Their Memphis Factory:

[Em Tee]

https://reverb.com/news/gibson-set-t...&utm_source=FB

Gibson brands is set to relocate its Memphis operations to a smaller location and plans to sell the massive facility that it currently calls home.

The Nashville-based guitar maker opened the Memphis facility 18 years ago, which currently occupies just a portion of a massive 127,620 square foot complex. According to the Memphis Daily News, Gibson plans to search for a new facility for its Memphis operations and will stay in the current spot for the next 18 to 24 months. The facility, which sits across from Fedex Forum along South B.B. King Boulevard, is expected to list for $17 million.

Since its opening, the Gibson Memphis shop has mostly focused on building hollow and semi-hollowbody guitars, such as the famed ES series. Presumably, this shuffling of assets is meant to address Gibson's well-publicized financial troubles.

Update: Gibson issued a press release about the move, with CEO Henry Juszkiewicz stating:

"We are extremely excited about this next phase of growth that we believe will benefit both our employees, and the Memphis community. I remember when our property had abandoned buildings, and Beale Street was in decline. It is with great pride that I can see the development of this area with a basketball arena, hotels, and a resurgent pride in the musical heritage of the great city of Memphis. We continue to love the Memphis community and hope to be a key contributor to its future when we move nearby to a more appropriate location for our manufacturing based business, allowing the world the benefit of our great American craftsmen."

[Chinn]

Disappointing, but not at all surprising.

I live fairly near it and enjoyed the tour. In addition to mando, I play electric guitar, so the tour hit home.

[colorado_al]

I'm sure it is due to the massive decline in electric guitar sales as of late.
https://www.washingtonpost.com/graph...ectric-guitar/

Sales are down by over 30% from a decade ago, even though most folks have more disposable income than they did during the recession. In 2008 and 2009 industry wide, electric guitars were selling about 1.5 million/year. Now selling about 1 million/year, and continuing to decline.

Also, sure that they saw a chance to unload the property which they bought very cheaply and is now worth a lot more. And now that sales are down, they don't need as much space and can find a cheaper smaller facility elsewhere in town. Might even buy them a few years reprieve from their debt.

[allenhopkins]

Interesting that they call their downsizing "growth."

The last ten pounds I put on, I called "the next phase of my weight loss."

[Brian Harris]

I have a friend/luthier who worked at Lay's Guitar in Akron (kinda' famous guitar shop - at least for us). He felt the article was correct - their business is dominated by old white dudes with vintage electrics.

The local Guitar Center said their electrics outsell the acoustics... hence the reason the prime retail area is still electrics.

Take all that with a grain of salt. But it seems to make sense - if you like electronic-based noises/tones, you might as well get a keyboard/sequencer/computer. If you're "Au naturale," you'll gravitate toward acoustics. And yeah, that's a false dichotomy for arguments sake. I'm sure most dabble in both worlds even if I don't.

[Timbofood]

Allen, I have a buddy who has lost the same twenty pounds for the last twenty years. He loses 20, gains 30! But, he’s always just lost 20!

[Jeff Mando]

I get worried when of company the stature of Gibson has to sell a property worth $17 million, to better organize. It looks like a company who is paying $200 million plus a year in salaries should keep a bigger slush fund, just in case.

[colorado_al]

Gibson is in serious debt and they have had their credit downgraded again - to Caa3 - 9 grades below BB junk status.
If they can't restructure before next summer, they'll likely default and be split up by investors.
My bet is bankruptcy and repurchase by a new private equity fund
https://www.thestreet.com/story/1428...-its-debt.html

[Bernie Daniel]

Gibson is in serious debt and they have had their credit downgraded again - to Caa3 - 9 grades below BB junk status.
If they can't restructure before next summer, they'll likely default and be split up by investors.
My bet is bankruptcy and repurchase by a new private equity fund
https://www.thestreet.com/story/1428...-its-debt.html

Get your David Harvey signed F-5 soon?

[jesserules]

<> a company who is paying $200 million plus a year in salaries should keep a bigger slush fund, just in case.

Pretty sure Henry's retirement fund has first call on that.

[Charlieshafer]

Gibson is in serious debt and they have had their credit downgraded again - to Caa3 - 9 grades below BB junk status.
If they can't restructure before next summer, they'll likely default and be split up by investors.
My bet is bankruptcy and repurchase by a new private equity fund
https://www.thestreet.com/story/1428...-its-debt.html

Interesting little article. It seems all the music companies mentioned, Gibson, Fender, Steinway, and Guitar Center are in trouble due to massive debt, and all are already owned by private investment firms. I'm sure all the private firms have already sucked as much capital out of these as possible, and bankruptcy is the most likely outcome for all. Hopefully there's enough left to warrant keeping the brands going without a total loss of quality, as in licensing the name to whomever can knock them out.