The future is looking grim for two mainstay suppliers in the OEM and aftermarket automotive space.
Well-known seat manufacturer Recaro Automotive has filed for bankruptcy, according to Autocar. The German outfit supplies chairs to BMW, Ford, and Volkswagen, among others, and was approved on Monday for self-administration by the Esslingen District Court.
Autocar says that according to local reports, workers at the company had not been informed of the plans to file for bankruptcy. The IG Metall trade union, which represents the workers at the factory in Kircheim unter Teck, has stated that the future of said workers is now unclear, and has called for transparency from Recaro’s management.
In a statement released on 29 July, Recaro Automotive GmbH confirmed that it had indeed filed for insolvency. “The company encountered significant financial difficulties due to extreme price increases in recent crisis years and the loss of a major contract,” the statement said as reasons for the decision.
“Insolvency payments will secure employees’ wages and salaries,” the statement continued. Recaro plans to maintain full production during the insolvency proceedings to fulfil all existing orders and new customer enquiries.
At the close of the statement, there seemed to be a glimmer of hope for what lay on the other side of this proceeding: “The financially distressed, traditional Swabian company intends to strengthen its position both locally and globally through this process, under judicial supervision and with the support of Baker Tilly.”
Recaro also builds seats for the aviation and gaming industries, in addition to other sectors. As of now, the self-administration filing applies solely to the automotive branch of the conglomerate. Four years ago, American supplier Adient sold off Recaro Automotive to a private investment firm called Raven Acquisitions.
The name “Recaro” first appeared in 1963, when German firm Reuterr Carosserie melded its two words into one. But even before the arrival of the catchy name, the seatmaker had already enjoyed a long, prosperous relationship with Porsche that stretched back more than a decade earlier.
Since Recaro’s formation in the ’60s, the firm has become a mainstay in the automotive space. Recently, it has built chairs for high-performance vehicles such as the Aston Martin Valkyrie and plenty of track-hunting Porsches as well as for grand tourers like the Audi R8 and sports cars like the Mustang Shelby GT350, among many others. Recaro is also a trusted name in the racing industry. Sadly, it isn’t alone in its financial trouble.
Legendary wheel manufacturer BBS has also filed for insolvency proceedings at the Rottweil Local Court, according to Motor1. This isn’t the first time the beloved wheel manufacturer has found itself in turbulent straits – or even the second: BBS has faced financial crises four other times since 2000.
The company’s latest owner, ISH Management Services, acquired BBS Automotive GmbH in June of this year, before the latest insolvency filing. Just like with the Recaro saga, the IG Metall trade union was reportedly blindsided by this move.
Founded in 1970 by Heinrich Baumgartner and Klaus Brand in Schiltach, a small German village to the south of Stuttgart, BBS began as a plastic parts supplier but soon turned its attention to wheel design, aiming to reduce unsprung mass and increase vehicle performance. In 1983, the firm introduced its iconic BBS RS three-piece wheel, which today is one of the most recognisable and sought-after aftermarket designs. For a full history of the company, see this story we ran in 2020.
BBS also has a star-studded list of clients, including Porsche, BMW, and Ferrari. Additionally, the company has long been a trusted name in the racing wheel space, supplying many of the world’s top motorsports teams as well as those in several lower-tier series.
We’ve reached out to both firms for comment and will update this story when we hear back.
The future is uncertain for either of these celebrated brands, but we trust you’ll join us in hoping for decent resolutions that enable both Recaro and BBS to continue adding that little bit of extra flair to automobiles old and new.
