Mike Kennedy, President - the ex-Harley man has
navigated Vance & Hines through the MAG
'Unwind', and inherited the race relationship with
his Alma Mater that he was responsible for
putting in place with Terry Vance more than a
decade ago.
The decade since the 2007/2009
financial crisis has been tough for most
manufacturers in our industry, and
now bookended by the COVID-19
triggered recession, the progress made in
those ten years is now up for grabs.
For a small group of manufacturers, of which Vance
& Hines is arguably the most prominent, the added
trauma of the acquisition of parent company
Motorsport Aftermarket Group (MAG) by Lacy
Diversified (LDI) in 2014 and the 'merger' with Tucker
Powersports didn't help matters.
As MAG CEO Hugh Charvat observed in 2019, it was
the kind of tall omni-channel business model that
looked good on a wipe clean board to a bunch of
MBA private equity types, but in fact it turned out
that it was MAG itself that was as much of the
problem as the continuing atrophy in parts and
accessory industry sales.
However, the MAG 'Unwind' of 18 months ago saw
each of the individual group companies start to
report directly to the Private Equity ownership group
- Monomoy Capital Partners, Contrarian Capital
Management and Blue Mountain Capital. Ever since
then, all the constituent components of the Group
have been on an upward trajectory - in the capable
hands of John Potts, industry veteran Eddie Tejeras,
Tom Trobaugh and ex Harley man Mike Kennedy, but
none more so than Vance & Hines themselves.
Charvat had quickly concluded that the LDI
acquisition of MAG and 'merger' with Tucker was
35 year Vance & Hines veteran. Eddie Tejeras
fundamentally flawed. At best, the integration of
manufacturers, brands, distribution, retail and even
media into a multifaceted channel-busting business
model was predicated on assumptions about
ongoing market growth that never materialized.
At worst, in a relationship-driven industry the new
structure isolated the brands from their traditional
core customers and from the source of their capital
requirements. Reporting through MAG was like
"trying to conduct brain surgery while wearing
boxing gloves," as one of the company presidents
put it to me in the summer of 2019. Decisions were
Performance geek Byron Hines (left) and drag
racer Terry Vance founded their exhaust
manufacturing business in California in 1979.
taken on a Group basis, each individual component
shaping the whole, rather than on the merits of the
needs and differences between the individual
businesses, resulting in none of the decision-making
outcomes being specifically right for any of them.
When I visited with John Potts and Mike Kennedy at
the Vance & Hines headquarters facility at Santa Fe
Springs, California, earlier this year, I found a
business whose sense of purpose, ability to
determine its own path and vision for its future were
liberated and racing forward with a renewed sense
of opportunity and freedom.
Torquer 450 - seen here in
chrome on the Road Glide.
24 AMERICAN MOTORCYCLE DEALER - OCTOBER 2020
www.AMDchampionship.com