BBS WHEELS COMPANY WENT BANKRUPT

BBS Wheels, a leading manufacturer of automobile wheels in Germany, has filed for bankruptcy. The relevant documents were sent to the court. The experts note that this is the third bankruptcy experienced by the company over the past fifteen years.  

The previous bankruptcies of 2007 and 2011 allowed it to obtain the necessary protection from the financial obligations to the creditors.

Back in 1972, the brand gained fame by launching a new model of a racing steering wheel on the market.  Today the company is known for its working on the reduction of weight of car rims. This technology is called Air Inside.

The engineers managed to create hollow compartments around the edges of the wheel rim by casting. This improves safety and increases the resistance to the edge deformation. Such discs, which are produced by a laser welding, are lighter than conventional discs by more than 5 kg. 

The experts in the automotive market suggest that the main reason for the company's management to make such a decision could be the COVID-19 pandemic and the associated production slowdown.

The first bankruptcy experienced by the company in 2007 resulted in a change of the ownership. The company was acquired by Belgian entrepreneurs. Another bankruptcy that took place in 2011 ended in a change of the ownership in 2015. Then the company was bought by the Nice Holdings Co from South Korea. How the bankruptcy of 2020 will end for the BBS Wheels, is still unknown. 

The article of the German regulation, according to which the company went to court, does not imply liquidation. It is about being able to continue working in difficult conditions.

The company itself hopes that the legal procedure will gain time and let restructure the financial debts, ensuring the further operation of the company's enterprises in different countries.

The experts wonder, what might happen to the company's division in the United States. Earlier it became known that the BBS Wheels concluded a contract with NASCAR, according to which the company assumed an obligation to supply wheels of a new type for the American cars. If the terms of the contract are met, the usual 15-inch steel wheels may completely leave the US automotive market. They should be replaced by the lighter 18-inch aluminum wheels.  

The year before last, the company finished its work, having received € 90 million in profit and only € 11 million in losses.

Will the bankruptcy of the company lead to the search for an investor able to make the brand even more viable? The experts believe that it all depends on the impact of external factors on the company's activities, including the pandemic and its effects on the automotive market.