Earlier this week, Polaris made the shocking announcement that it would be selling Indian Motorcycle after reviving the brand nearly a decade ago. The sale, which is to a private equity firm named Carolwood LP, has raised a ton of questions about the future of the brand. And rightfully so.
Private equity, in recent years, has become synonymous with gutting of companies six ways to Sunday. I know this from personal experience, as well as watching brands I loved die sus deaths after private equity waltzs in. The formula is simple, and literally the same nearly every time. Buy at an overvalued market price. Saddle the property with debt accrued in paying way too much for the compamy. Cut employees and make a product worse to get out of debt. Sell the property for pennies on the dollar after having given executives fat bonuses.
But Indian's new owners have never sold a property. The price detailed in the original press release isn't insane for a company and IP like Indian. And the person Carolwood LP has brought in to run Indian, Mike Kennedy, at least comes from the powersport and motorcycle world, having even worked for Indian's biggest competitor, Harley-Davidson. Whether that's a plus or not given Harley's current outlook, however, remains to be seen.
Yet, the whole cloak-and-dagger nature of the transaction, along with wording that RideApart pointed out in the original release in regards to who's staying with the company and who's not, has made many wonder whether Carolwood LP would be just another PE firm ready to slice, dice, and julien the American marque. According to letters obtained by CycleWorld, both Polaris and Indian's new owners are doing whatever they can to squash those worries.
"Indian Motorcycle Team," starts the letter from Carolwood LP sent out to Indian's some 1,000-plus employees, "We are thrilled to introduce ourselves and share our excitement about the next chapter of Indian Motorcycle. Carolwood is an independent private equity firm founded more than a decade ago by Andrew Shanfeld and Adam Rubin. Our mission is to partner with iconic businesses and empower them to thrive as independent companies. We are long-term investors in strong brands, exceptional people, and legacies that matter. Indian Motorcycle embodies all three. Over the course of our deal discussions, we've had the privilege of working closely with your leadership team, and what stands out most is the deep pride, craftsmanship, and passion that runs through this organization. That spirit — for the ride, for the brand, and for each other — is what will power Indian Motorcycle forward in the years ahead. Indian Motorcycle will be Carolwood's flagship company. Our goal is to build a nimble, unified American motorcycle company — one that honors Indian's unmatched heritage while fearlessly competing for the future."
That sounds great, right? Yeah, totally. But it also sounds very much like those letters I've personally received on the heels of a company buying the company I'd been working at, i.e. The Drive, and Automobile Magazine which was housed under Motor Trend at the time when Discovery purchased it. It sounds like the letters I've seen from friends who used to work at Jalopnik, Autoweek, CNET, Playboy, and oh so many others. But again, it should be noted that long-term investment is what Carolwood LP has done with its other brands, small as those other brands may be compared to Indian. Again, the group has never sold a property. Though, in my experience, "nimble" is a concerning term, especially as it relates to Indian's employees.
To that end, in the second paragraph where Carolwood LP introduces Kennedy as the brand's new CEO, this line appears, stating, "[Kennedy] will be responsible for day-to-day collaboration with the management team and helping ensure the transition is seamless and energizing for everyone. While change naturally comes with new ownership, our approach is rooted in respect — for the brand's history, for its people, and for what Indian Motorcycle represents to riders everywhere. We believe deeply in this company's future and are committed to giving it the independence, resources, and focus it deserves to thrive."
Emphasis mine, as both mentioned here and in our original report on the sale, Indian currently employs over 1,000 people. But in the release, only 900 or so folks are currently slated to make that transfer. Again, I've been in the position before, which is perhaps why I give more weight to these words, as they've been said to me. They've been issued to me. I'd been told that changes would be made, good changes, changes in which we'd get the resources we need, but those in power failed to mentioned that those changes resulted in job cuts. So I feel for those affected by any sort of changes when a transfer of power occurs.
I do, however, hope I'm incorrect in my experience-based assumptions. Only time will tell, though. But in understanding Indian's history, and the tumult its been through in the 120-plus years its been around, weathering a storm is one of the brand's strengths. And with Harley on its heels and hoping for its own turnaround, it too having a new CEO—though one with more pizza and golf experience than motorcycle compared to Kennedy—Indian could claim the cruiser crown.
And hey, maybe even though the brand just killed the awesome FTR, they'll used that knowledge and engineering to build a middle-weight adventure motorcycle? Which is something Harley should've done ages ago. One can hope, right?
