Bloor Holdings, the parent company of Triumph Motorcycles had a tough year in 2007-08, according to annual accounts filed at Companies House in the UK.
Although Triumph motorcycle division turnover rose by 29% in the year ending 30th June 2008, the recession in the housing market caused problems for Bloor Homes. The losses in the housing division, plus ongoing investment in Triumph, caused Bloor Holdings to breach its bank agreements, as debt doubled to £249m.
This left Bloor Holdings with the choice of either refinancing its existing debt, or repaying £90m within a year. The company chose to renegotiate its lending facilities with a new finance provider, and according to reports in the financial press, this corporate debt schedule is now agreed until March 2012.
Bloor Homes has taken action to offload its slow-selling UK apartments to housing associations, whilst Triumph motorcycles now has a third factory up and running in low-wage Thailand, to help boost their profit margins.
Globally, some 60% of Triumphs sold are sports, or sports-touring models, with cruisers and modern classics accounting for around 20% apiece. With the launch of the big Thunderbird twin, Triumph are hoping to win some more cruiser sales in the USA, although much depends on the the speed and strength of the US economic recovery.
As regards the Hinckley factory, it is one of the most efficient in the bike industry, capable of producing a motorcycle engine every ninety seconds. Robots do many of the main tasks at the factory, with outsourced, low-cost parts fitted by hand, using JIT ( just in time ) supply chain logistics.
Despite the likely interest rate hit taken by Bloor Holdings as it has to juggle its company debt, it’s useful to note that Triumph motorcycles will soon have the bulk of its production outsourced to the Far East. Furthermore, a new online global parts ordering service, which links each Triumph dealer to both Hinckley and Thailand simultaneously when sourcing spares and accessories, will also save time and money.
All that should help Triumph weather more financial, or political storms, which could affect the European and American motorcycle markets in the near future.