BMC claims “business is back on track” despite refusal of ‘short-time working compensation’ and more staff reportedly leaving the business

BMC has claimed that after a turbulent period that has plagued almost every bike manufacturer in the last couple of years, its business has stabilised and the bottom line is looking up, despite the company getting its application to cut hours of its remaining staff rejected by the local government in Switzerland. Meanwhile, road.cc understands that more employees have proceeded to part ways with the company which now describes itself as a “mid to high-end” brand with no entry-level bikes.

In February, the Swiss-based bike brand had applied for a ‘short-time working compensation’ arrangement with the office for economics and labour in the Swiss canton of Solothurn, the relevant authority for the city of Grenchen, where BMC is based.

It was reported that the company was taking these steps to explore the possibility of reducing employee hours as a response to the waning demand since the pandemic bike boom, which BMC’s CEO David Zurcher described as taking “appropriate preventive measures” and making  “necessary adjustments” at the time.

> BMC applies to cut hours of remaining staff due to falling demand

This week, BMC told road.cc that its application made before the start of the new year for ‘short-time working compensation’, a Swiss scheme where businesses can put a proportion of workers on temporary part-time hours while the local government covers their remaining salary to avoid redundancies, was not granted, but claims this was “totally fine” and “all hot air”.

“We thought we’d ask given we globally had 15 per cent lower sales in 2023 and the industry outlook for 2024 was not that encouraging”, the spokesperson continued, adding that a lot of other businesses in Switzerland had also benefitted from this scheme.

2024 BMC Roadmachine

BMC says that after the short-work application was refused, 11 people were made redundant with “no further reorganisation” planned for now or later this year.

However, road.cc understands that at least seven more staff members left BMC after the short-work application was denied, and separately to the round of redundancies that reportedly happened in October 2023. The reasons for additional staff leaving are unclear, while it's also not clear if the redundancies occurred before or after the refusal of BMC's short-working application.  

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BMC, though, insists that “business is back on track” and has “been less affected compared to many other brands” due to BMC’s focus on the mid to high-end market.

“Since then we work full-time and are even hiring”, the spokesperson said. “We hear from Shimano and SRAM [that] mid-high-end business is much more stable if not growing, same here!”

Meanwhile, BMC also told road.cc that its latest race bike Teammachine R and the entire family of Roadmachines have been driving growth in the last six months and are “in-demand” with European and North American retailers.

However, reliable sources have also informed road.cc that the brand is sitting on a significant stock of unsold inventory, most of them being e-bikes, thereby explaining the company’s strategic repositioning in the relatively higher-end market.

2023 BMC Teammachine R - 1

The getting back on track for BMC could signify a faint glimmer of hope for the bike market which has been suffering with supply chain issues and as a consequence, making losses in the last couple of years, with a Bicycle Association report stating that 2023 saw the worst bicycle sales in the UK since 1985.

The news would also be buoyant for the company which last November made an exit from the WorldTour peloton, after it was announced that Decathlon–AG2R La Mondiale would no longer race the manufacturer's bikes, moving to Decathlon’s in-house high-end brand Van Rysel instead.

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Just yesterday, Rapha became the latest company in the bike industry to make another wave of redundancies, joining Raleigh which also confirmed layoffs in January following its departure from the Nottingham headquarters, Strava, Wahoo, British Cycling to name a few, as it closed its US office as part of a sudden realigning due to “current market dynamics” and to “better reflect our strategic priorities”.

Rapha’s CEO Francois Convercey said: "We are realigning Rapha to better reflect our strategic priorities and current market dynamics. Over the past five years, Rapha has experienced significant growth and these recent changes will focus us on accelerating towards our purpose of inspiring the world to live life by bike.

A former employee, who gave their account anonymously, said that they were “terminated for non-performance reasons” upon arriving at work on Wednesday, the Bentonville office which has been in operation since 2020 to close with the job cuts. The latest redundancies followed similar cuts in 2018 and last September.

> Rapha makes redundancies as US office closes in "realigning" of business due to "current market dynamics"

Earlier this week, we also reported that Shimano posted another significant fall in sales figures, with net sales down 22.6 per cent in the first quarter of 2024 amid predictions its annual sales in Europe could contract by more than £170 million this year.