Alex Cogger, former chief product officer for Rocky Mountain Bikes, says he was a bit surprised to get a call right before the Christmas holidays informing him he would be temporarily laid off from the company.
The bike manufacturer had recently let a number of employees go and Cogger thought his job would be safe because there already weren’t many people left to maintain operations in North Vancouver, where the company carries out design, prototyping and marketing.
But the layoff call that he and about a dozen people received came on the eve of a creditor protection filing in the 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 kept its Saint-Georges headquarters since buying the company from its Vancouver-based founders in 1997, the company’s financial difficulties are the result of a major decrease in demand for bicycles following the COVID-19 pandemic.
RAD Industries’ debt has increased from $48.2 million in the 2022 fiscal year to $68.7 million in 2024. And the company continues to see operating losses, according to court documents, making the future of a bike brand closely tied to British Columbia’s world-famous style of freeride mountain biking uncertain.
Pandemic pressures
During the early pandemic, global demand for bicycles skyrocketed, but supply chain issues quickly followed, leading to bike part shortages for both consumers and companies like Rocky Mountain.
“The pandemic boom was a global phenomenon. People were locked up inside, they wanted to go outside, everybody went and bought bikes,” said David Cathcart, the recently laid-off chief commercial officer at Rocky Mountain.
Cathcart says it was taking as long as 600 days to get some parts delivered, as warehouses emptied out. Just as supply chains began to catch up and inventory started coming in, lockdowns lifted and demand “fell off a cliff.”
The court documents describe the situation for RAD Industries, including excess inventory, significantly discounted bikes and the need to borrow more money.
“It’s kind of like a ‘how long can you tread water’ situation for companies,” said Cathcart. “This is why you can see the smaller companies that don’t have the same capital resources aren’t able to hold on.”
Raymond Dutil, owner of RAD Industries, says the problems for his company started in March 2023, when American bicycle giant Specialized began to discount bikes.
“Those guys are major; we had to react to them,” said Dutil, 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 tough position to weather the market turmoil.
According to court documents, Rocky Mountain took a $17.8-million loss in 2023 with a failed venture to supply e-bikes for a bike share company. That was part of the $11-million net loss for Rocky Mountie that year.
B.C. operations affected
Rocky Mountain’s origins are traced back to Vancouver in 1981. The company was a major part of the rise in mountain biking through the 1980s and 1990s, being closely identified with the rugged, technical downhill style of riding that developed in the mountains of Metro Vancouver’s North Shore.
Steve Savage, general manager of the North Vancouver bike shop Steed Cycles, says his business became a Rocky Mountain distributor 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 iconic North Shore brand,” said Savage. “My first real mountain bike was a Rocky.”
The Rocky Mountain bikes were among the first to be designed for what Savage describes as really aggressive freeride trails. He says that’s the style of riding that eventually evolved into bike parks and helped drive the growth of mountain biking around the world.
“It kind of zeroes back to North Van for a lot of that,” he said.
The company even has the very desirable website 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 remaining staff are busy doing equipment inventory and dismantling the office.
Dutil says the company is trying to find a new space that is about half the size of the current North Vancouver facility.
“I hope North Van staff will return,” he said. But nothing beyond the next three months is known.
“For me, Vancouver is very important,” said Dutil, “When I bought it in 1997, people were scared we would move the company, but it was very important for me to keep it in Vancouver.”
However, it’s unclear whether Dutil will remain the owner of the company after the restructuring process. He says he hopes to find a partner to make a bid and keep the business in his family.
Cathcart says he hopes the court-ordered process, which is expected to be finalized in April, results in a “proper steward for the brand.”
“What I’m hopeful about is that it really ends up in the hands of somebody who can nurture it the right way,” he said.
