Alex Cogger, former product manager at Rocky Mountain Bikes, says he was a little surprised when he received a call just before the Christmas holidays informing him that he was being temporarily laid off from the company.
The bike maker had recently laid off several employees and Cogger thought his job would be safe because there weren’t many people left to maintain operations in North Vancouver, where the company does design, prototyping and marketing.
But the layoff call he and a dozen others received came on the eve of a creditor protection filing in Quebec Superior Court, where Rocky Mountain Bikes’ parent company, RAD Industries Inc., revealed its dire financial situation. .
According to court documents filed in Quebec, where Rocky Mountain has maintained its headquarters in Saint-Georges since purchasing the company from its Vancouver-based founders in 1997, the company’s financial difficulties are the result of a significant decline in demand for bicycles. after the COVID-19 pandemic. 19 pandemic.
RAD Industries’ debt has increased from $48.2 million in fiscal 2022 to $68.7 million in 2024. And the company continues to suffer operating losses, according to court documents, making the future of a brand of bicycles is closely linked to the world-famous style of British Columbia. of freeride mountain biking is uncertain.
Pandemic pressures
During the early part of the pandemic, global demand for bicycles skyrocketed, but supply chain issues quickly arose, leading to shortages of bicycle parts for both consumers and companies like Rocky Mountain.
“The rise of the pandemic was a global phenomenon. People were stuck inside, they wanted to get out, everyone went and bought bikes,” said David Cathcart, Rocky Mountain’s recently fired chief commercial officer.
Cathcart says it took up to 600 days to deliver some parts as warehouses emptied. Just as supply chains began to catch up and inventory began to arrive, lockdowns were lifted and demand “fell off a cliff.”
Court documents outline RAD Industries’ situation, including excess inventory, significantly discounted bikes and the need to borrow more money.
“It’s kind of a ‘how long can you last’ situation for businesses,” Cathcart said. “That’s why you see that smaller companies that don’t have the same capital resources can’t hold on.”
Raymond Dutil, owner of RAD Industries, says the problems for his company began in March 2023, when American bicycle giant Specialized began discounting bicycles.
“Those guys are important; we had to react to them,” Dutil said, adding that $1,500 bikes had to be sold for $1,200.
Cathcart says there were other complicating factors that put the company in a difficult position to weather the market turmoil.
According to court documents, Rocky Mountain suffered a $17.8 million loss in 2023 from a failed venture to supply electric bikes to a bike-sharing company. That was part of Rocky Mountie’s $11 million net loss that year.
BC operations affected
Rocky Mountain’s origins date back to Vancouver in 1981. The company was an important part of the mountain biking boom during the 1980s and 1990s, and became closely identified with the technical, rugged style of downhill that developed in the mountains. of northern Metro Vancouver. Coast.
Steve Savage, CEO of North Vancouver bike shop Steed Cycles, says his company became a Rocky Mountain dealer just three months before the company entered creditor protection.
“They’ve always been a brand that’s been on our radar for a long time — obviously the iconic North Shore brand,” Savage said. “My first real mountain bike was a Rocky.”
Rocky Mountain bikes were among the first designed for what Savage describes as truly aggressive freeride trails. He says that’s the style of cycling that eventually evolved into bike parks and helped fuel the growth of mountain biking around the world.
“A lot of it comes down to North Van,” he said.
The company even has the highly desired web address www.bikes.com.
But the future of the North Vancouver Rocky Mountain facility is now uncertain. Cogger says the lease expires next month and the remaining staff is busy inventorying equipment and dismantling the office.
Dutil says the company is trying to find a new space that is about half the size of the current facility in North Vancouver.
“I hope the North Van staff comes back,” he said. But nothing is known beyond the next three months.
“For me, Vancouver is very important,” Dutil said. “When I bought it in 1997, people were afraid that we would move the company, but it was very important to me to keep it in Vancouver.”
However, it is unclear whether Dutil will continue to own the company after the restructuring process. He says he hopes to find a partner to bid on and keep the business in his family.
Cathcart says he hopes the court-ordered process, which is expected to be completed in April, will result in a “proper trademark administrator.”
“What I’m hoping for is that it really ends up in the hands of someone who can nurture it the right way,” she said.
