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  1. #1
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    Dorel acquires Cannondale Bicycle Corporation

    Dorel acquires Cannondale Bicycle Corporation - Two distinct bicycle divisions to be created
    EXCHANGES TSX: DII.B, DII.A

    - High performance bicycles known worldwide
    - Transaction reinforces Dorel's focus on core businesses
    - Purchase is immediately accretive to earnings

    MONTREAL, Feb. 4 /CNW Telbec/ - Dorel Industries Ltd. (TSX: DII.A,
    DII.B) today announced it has acquired the Cannondale Bicycle Corporation, a
    leading designer, developer and manufacturer of high-end bicycles.
    Headquartered in Bethel, Connecticut, Cannondale has facilities in Bedford,
    Pennsylvania as well as offices in Canada, Switzerland, Holland, Japan, and
    Australia. Widely regarded as the bike industry's leading innovator,
    Cannondale's handcrafted bicycles have won numerous design awards and are sold
    in over 70 countries. The purchase also includes Sugoi Performance Apparel.
    Sugoi products are used worldwide by runners, cyclists, triathletes and
    fitness enthusiasts who demand the best apparel available.
    The total value of the all-cash transaction will be US$190 to
    US$200 million, subject to Cannondale's earnings results for the year ending
    June 30, 2008. The transaction, which will be immediately accretive to Dorel's
    earnings, is being financed through debt. Cannondale and Sugoi are being
    purchased from an affiliate of Pegasus Capital Advisors, which acquired the
    company in 2003. 2007 sales for Cannondale and Sugoi were approximately $200
    million.

    A clear strategy for the IBD category

    Dorel President and CEO, Martin Schwartz stated that in light of the
    acquisition the Company's Recreational/Leisure segment is being split into two
    distinct operating divisions. A new Dorel Independent Bicycle Dealers (IBD)
    division, the Cannondale Sports Group, is being created and will focus
    exclusively on this category with premium-oriented brands. Backed by Dorel's
    extensive resources, the Cannondale Sports Group will build on Cannondale's
    strengths to grow significantly within the IBD channel. "Our intention is to
    build a world-class company that dealers will want to buy from," said
    Mr. Schwartz. Pacific Cycle will become a stand-alone division with an
    exclusive focus on mass merchant customers.
    "The Cannondale purchase is consistent with Dorel's plan to concentrate
    on its core businesses. Since buying Pacific Cycle in 2004 we have learned a
    great deal about the bicycle industry and have found it to be a true value
    driver for Dorel. We are committed to pursuing this sector, and this important
    transaction will position us globally in a most material way. Dorel recognizes
    the importance and potential of the Independent Bicycle Dealer channel and is
    purchasing Cannondale as the first step to become the world's number one IBD
    player. Cannondale will be the crown jewel of this new Dorel division, which
    will seek additional such growth opportunities."
    Note: Please refer to the separate release issued today "Dorel Creates
    Two Distinct Bicycle Divisions Following Cannondale Acquisition".
    "We're excited about the future for Cannondale and our retailers.
    Cannondale's goal is to be the number one supplier to the IBD channel. Dorel's
    vast resources and experience provide us with long term stability and the
    ability to accelerate our goals for growth with our retailers," stated Matt
    Mannelly, President and CEO of Cannondale.

    A history of innovation, a record of wins

    Cannondale has come a long way since its establishment in 1971, when it
    introduced the cycling industry's first bicycle trailer. The company grew
    quickly, adding cycling apparel and accessory lines while earning a strong
    reputation for innovation and quality. Cannondale raised the cycling world's
    eyebrows by equipping its bicycles with handcrafted aluminum frames that were
    both lighter and more flex-resistant than the steel models that dominated the
    industry at the time.
    Many of the ideas that keep Cannondale products on the cutting edge come
    from the sponsored athletes on the Company's professional racing teams.
    Cannondale has an outstanding heritage in competitive cycling and has
    consistently been on the leading edge of sports marketing. Cannondale bikes
    have been powered to multiple stage wins in the Tour De France and have won
    4 overall Giro d'Italia titles alongside countless World Cup Wins and World
    Championship titles off road. Today Cannondale continues to push the envelope
    in bicycle innovation and material expertise and is the bike of choice for the
    Liquigas Pro Cycling Team, Cannondale Vredestein professional mountain bike
    team, along with mountain bike legend Tinker Juarez and a host of other world
    class professional cyclists and triathletes.
    Mr. Schwartz stated that Dorel's Recreational/Leisure segment has an
    enormous opportunity to capitalize on the changing mindsets and trends around
    the world. "Increasingly, people are actively engaged in seeking healthier
    lifestyles; are concerned about the environment, and want to do something
    about it; and desire sustainability at all levels. We sincerely believe our
    products can help meet these objectives. This transaction underlines our plan
    to further unlock value within the Company, concentrating on the
    Recreational/Leisure and Juvenile segments which provide the greatest
    potential."

    Conference Call

    Dorel Industries Inc. will hold a conference call to discuss the
    Cannondale acquisition today at 10:30 A.M. Eastern Time. Interested parties
    can join the call by dialling 1-800-732-9307. The conference call can also be
    accessed via live webcast at www.newswire.ca or www.q1234.com. If you are
    unable to call in at this time, you may access a tape recording of the meeting
    by calling 1-877-289-8525 and entering the passcode 21261172# on your phone.
    This tape recording will be available on Monday, February 4, 2008 as of
    12:30 P.M. until 11:59 P.M. on Monday, February 11, 2008.

    Media

    Media interested in interviewing Dorel senior management today should
    contact Rick Leckner at 514-731-0000. Photo opportunities will also be
    available.

    Profile

    Dorel Industries (TSX: DII.B, DII.A) is a global consumer products
    company engaged in the designing, manufacturing and marketing of a diverse
    portfolio of powerful consumer brands, sold through its Juvenile,
    Recreational/Leisure and Home Furnishings segments. Headquartered in Montreal
    and with significant operations in the United States and Europe, Dorel employs
    approximately 4,700 people in 15 countries. Annual sales are US$1.8 billion
    and are made in over 60 countries worldwide.
    US operations include Dorel Juvenile Group, which markets the Cosco and
    Safety 1st brands as well as Eddie Bauer and Disney Baby licensed products;
    Pacific Cycle, which markets several brands including Schwinn, Mongoose, GT,
    InSTEP, Playsafe and Roadmaster; and Ameriwood Industries, which markets
    ready-to-assemble furniture products under the Ameriwood, Carina, SystemBuild,
    Altra Furniture and Ridgewood brands; Cosco Home & Office, which markets
    home/office products under the Cosco brand and Samsonite license as well as
    home healthcare products under the Cosco Ability Essentials and Adepta brands.
    In Canada, Dorel operates Dorel Distribution Canada, Ridgewood Industries and
    Dorel Home Products. Dorel Europe markets juvenile products throughout Europe,
    under the Bébé Confort, Maxi-Cosi, Quinny, Safety 1st, Babidéal, Mon Bébé and
    Baby Relax brands. Dorel Asia sources and imports home furnishings products.
    Dorel is the majority owner of In Good Care (IGC), a manufacturer and
    distributor of juvenile products in Australia, whose two principal brands are
    Bertini and Mother's Choice. Dorel also has eight offices in China,
    headquartered in Shanghai, which oversee the sourcing, engineering and
    logistics of the Company's Asian supplier chain.

    Cannondale profile

    Founded in 1971, Cannondale is a global designer, developer and
    manufacturer of high performance bicycles apparel and accessories. With a
    strong reputation for continuous innovation and quality the company is
    headquartered in Bethel, Connecticut, USA with offices in Canada, Holland,
    Japan, Switzerland, Australia, and a manufacturing facility in Bedford,
    Pennsylvania.

    About Pegasus Capital Advisors

    Pegasus Capital Advisors, L.P. is a private equity fund manager that
    provides creative capital solutions to middle market companies across a wide
    variety of industries. Established in 1995, Pegasus manages over $1.8 billion
    in assets through several private equity funds and has made close to
    70 investments since its inception. It is currently pursuing initiatives in
    several key sectors, including renewable and conventional energy, all-natural
    human and pet foods, alternative building materials, LED lighting, homeland
    security, niche consumer products and business services, as well as
    investments associated with sustainable business solutions for companies in
    other industries. The firm employs over 50 investment and advisory
    professionals working out of main offices in Cos Cob, CT and New York City.
    Caution Concerning Forward-Looking Statements

    Except for historical information provided herein, this press release may
    contain information and statements of a forward-looking nature concerning the
    future performance of Dorel Industries Inc. These statements are based on
    suppositions and uncertainties as well as on management's best possible
    evaluation of future events. The business of the Company and these
    forward-looking statements are subject to a number of risks and uncertainties
    that could cause actual results to differ from expected results. Important
    factors which could cause such differences may include, without excluding
    other considerations, increases in raw material costs, particularly for key
    input factors such as particle board and resins; increases in ocean freight
    container costs; failure of new products to meet demand expectations; changes
    to the Company's effective income tax rate as a result of changes in the
    anticipated geographic mix of revenues; the impact of price pressures exerted
    by competitors, and settlements for product liability cases which exceed the
    Company's insurance coverage limits. A description of the above mentioned
    items and certain additional risk factors are discussed in the Company's
    Annual MD&A and Annual Information Form, filed with the securities regulatory
    authorities in Canada and the U.S. The risk factors outlined in the previously
    mentioned documents are specifically incorporated herein by reference. The
    Company's business, financial condition, or operating results could be
    materially adversely affected if any of these risks and uncertainties were to
    materialize. Given these risks and uncertainties, investors should not place
    undue reliance on forward-looking statements as a prediction of actual
    results.



    For further information: MaisonBrison, Rick Leckner, (514) 731-0000;
    Dorel Industries Inc., Jeffrey Schwartz, (514) 934-3034


    View our Fact Sheet
    View corporate video

    Visit the website

  2. #2
    All Lefty's, all the time Moderator
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    Ah well, it was a fun ride, gosh I love "positive marketing spin" blah blah blah...... Here come the McCannondales
    This is a Pugs not some carbon wannabee pretzel wagon!!

    - FrostyStruthers



    www.mendoncyclesmith.com

  3. #3
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    Well, at least cannondale is supposed to be separated and a stand alone....(Yeah right).....But I guess Juvenile segment means cheap, asia produced frames...
    We'll see how it goes.....
    I guess now would be the best time to buy a couple more frames, 'cause I think the MADE IN USA sticker will soon be a thing of the past...
    "Common sense isn't always that common!"
    Custom Prophet and Custom Delta V

  4. #4
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    Montreal? Does it mean I can visit the headquarters on my lunch break now? I should go give my resume and apply to be a consultant or something.

    Let's wait and see. From what I gather, Pacific (GT, Mongoose...) will be the mass market brands and Cannondale will remain High End... and if they want to position Cannondale like they seem to (or want the public to think to), they will probably let Cannondale keep on doing what they do: innovate, make quality products for the passionnates... Again, we'll see how it goes in the long term.

    DAN.GEROUS.NET : MOUNTAIN BIKING : CYCLOCROSS : ROAD :

  5. #5
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    A sad day for a lad that grew up 20 minutes from the factory in Bedford, PA. I remember stopping by the factory on numerous occasions before or after a ride. The guys were always available to answer tech questions and to shoot the sh*t. Time will tell, but I am thinking that the writing is on the wall.

    I know that Schwinn and Mongoose still try to have upper lines, but their prestige is long gone. At least I will be able to take my Cannondale to Walmart for servicing?!

    JAH

  6. #6
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    a bummer..

    I am hopeful that this won't go the way things went with GT but I am still sore from that disaster..

    Here is a letter form the boss man:



    We have some excellent news regarding our future with you! Cannondale Bicycles has been purchased by Dorel Industries and will be the crown jewel in a newly formed IBD division "The Cannondale Sports Group."

    Dorel recognizes Cannondale's brand strength, product superiority and potential for growth in your stores. This Cannondale Sports Group is being created to focus exclusively on this category with premium-oriented brands and provides Cannondale with long term stability to excel at what we do best. Backed by Dorel's extensive resources, this division will build on Cannondale's strengths to grow exclusively within the IBD channel. Our intention is to continue to build the world-class company you want to grow your business with.

    Dorel's purchase of Cannondale is the first step to become the world's number one IBD player and Cannondale as the brand of choice. Pacific Cycle will become a stand-alone division with an exclusive focus on mass merchant customers.

    We've come along way in the past five years and wouldn't be at this exciting point without your dedication and support. Dorel is investing in the success that you helped us build and we're looking forward to them investing in the tools that 'will help us help you' grow your business in the future.

    Leadership and employees aren't changing at Cannondale. Our Cannondale passion to support the Independent Bicycle Dealers remains as strong as ever! What this means for you is a continued focus on ground breaking product and greater service to go along with it. It's business as usual at Cannondale-supplying you with the best damn product in the industry.

    Regards,

    Matt Mannelly
    ..I'd rather be a headlight on a northbound train..

  7. #7
    I Tried Them ALL... SuperModerator
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    It sux that Cannondale sold-out. I know they were hurting financially, for quite some time. I cannot understand why........they sell so many high priced bikes! If Cannondale is left to operate autonymously- then things could be the same as now. What concerns me about Dorel is that I hope they are not the corporate giant with deep pockets......but with [I][B]short arms!

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    This bites! I was just getting ready to pull the trigger on a F29er. One thing I really liked about it was the Made in USA branding. My current employer is hell bent on sending as much work as they can to India and I was hoping to do my part to keep America employed by buying a quality American made product. Now I'm not so sure. Looking at www.dorel.com doesn't inspire me with confidence. I get the sinking feeling this is another of those "buy the brand and ship the manufacturing overseas" companies.

  9. #9
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    F........ we will just have to wait and see. its a big company that got them, so maybe more money to develop. but also that means they have more overhead now.

    what ever

  10. #10
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    This isn't really bad news. Look at what has happened to GT after they were bought buy this group. The bikes they have out now are they best and sickest they ever have and i doubt seriosuly that they would have been able to produce these models w/o the captial from Dorel.

    When Dorel took over GT not one engineer or deisgner was let go or replaced by an outsider. They baiscally received and influx of cash and other much needed resoruces and told to take it up a notch. Imagine if c-dale took it up a notch.

    Let's wait and see what happens. My hopes are that this will allow for more high end model production based out of the USA, lower bike cost, and with better buying power for some pretty sweet build options in the future.
    one pedal stroke at a time

  11. #11
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    Wait a minute guys. First, Cannondale had already been 'bought' a while ago by Pegasus, they haven't 'sold out' just now. Is Dorel any better or worst than Pegasus? At least they already have bike companies so they have a bit of knowledge about the industry and hopefully, they know the place Cannondale has and should keep in the industry.

    Second, GT, Schwinn and Mongoose went down and hard before they were bought by Pacific and are now doing much better than they were before, in fact, they can be thankful they were saved by Pacific/Dorel. They have only improved as brands and products since 2004 and have had a lot more money for R&D and testing since, they now have much better products and are much better buisnesses than before Pacific/Dorel bought them... And it seems like Dorel wants Pacific to still be the mainstream, Wal-Mart or sport chain stores style bikes and Cannondale will be separate from the Pacific brands... The day we'll see a Cannondale in a Wal-Mart is not here fellows.

    Stopping yourself to buy a Cannondale because of that is foolish if you ask me. You want a bike now? A good bike? Look at what's available now, not what you think maybe the company will do in years to come. If you buy a current F29 that is US made, it speaks to them. If people stop buying them, then they might change the vocation of the company because the current Cannondale don't sell. I don't care much if the company is owned by Pegasus or Dorel, as long as they let the designers and engineers at Cannondale do what they do: make great bikes, unique bikes that I think are the best in the industry. Will I stop myself buying a great bike? No. When they stop producing quality bikes I want, then I'll stop buying.
    Last edited by Dan Gerous; 02-04-2008 at 11:12 AM.

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  12. #12
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    Sounds good doesn't it?:

    DAN.GEROUS.NET : MOUNTAIN BIKING : CYCLOCROSS : ROAD :

  13. #13
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    If Dorel had any intention of leaving Cannondale's existing manufacturing here in the USA, they would have made that distinction. Conspicuously, there's no mention of that.

    Do you really think that production will stay here now?? No way. The process to phase out, probably 99% of the manufacturing here (USA) will be ongoing from this moment on. Minus proto and pilot development bikes. . How do you think those manufacturing folks in Bedford, PA feel now??

    "Handmade in China." I guess we'll see.

    jeff

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    You do have a point. Buying the bike while it's still Made in the USA makes sense. Once it starts saying Made in China then I'd speak with my $s by not buying.

  15. #15
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    I've said it before and I'll say it again. Move the production out of the United States and Canondale looses its appeal to me. It's certainly not the only reason I buy Canondales, but it's the sensitive point- no matter how good and cheap a bike you can make overseas, my buying is equally fueled by quality and country of production.

    There's not many things I can buy here that are made in my own country, where those who build them pay taxes to my government and I can be assured their working conditions are safe. Bike frames are one of those things. I can buy American cars, but I don't, because they don't meet my quality requirements, so this isn't blind patriotism. Hopefully things are changing there, and I look forward to my first American car.

    So long as one American frame builder exists, I will support them. (If that fails, here's hoping I can at least buy from a Canadian company.)
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  16. #16
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    Quote Originally Posted by dweikert
    You do have a point. Buying the bike while it's still Made in the USA makes sense. Once it starts saying Made in China then I'd speak with my $s by not buying.
    Ditto.

    If there's no domestic content, then it'll just be a price decision for me. I've been willing to pay a bit more for Cdales up till now (3 in the garage), but that's largely based on NOT being made in asia.

    I like being able to buy a bike where the main component (frame) doesn't come out of the same factory as 5 other brands. Their Bedford factory is one of the main elements in their brand image as far as I'm concerned.

  17. #17
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    My C-Dale dealer is helping me with a warranty frame replacement. He was a Mongoose dealer when Mongoose was bought by Pacific/Dorel. Apparently during that deal warrantees were sent out lesser frames some of different sizes.
    This could really suck from my perspective

  18. #18
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    Quote Originally Posted by pedaler845
    He was a Mongoose dealer when Mongoose was bought by Pacific/Dorel. Apparently during that deal warrantees were sent out lesser frames some of different sizes. This could really suck from my perspective.
    That was exactly one of my thoughts. This is all speculation, but imagine the disappointment of having a current carbon Rush frame (err...Caad 5 track frame, Prophet4x), for instance, replaced under warranty with an outsourced frame?

    Sure, there are plenty of high end frames crafted in Taiwan, but when I purchased the carbon Rush, it was mostly because I wanted to support workers in the neighboring town, Bedford.

    I understand that Cannondale is a business that must be profitable to survive. Nonetheless, I sure would have liked a commitment for the manufacturing to remain here... We shall see.

    JAH
    Last edited by xJAHx; 02-04-2008 at 01:30 PM.

  19. #19
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    I believe the carbon Rush frames were already made in asia.

  20. #20
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    Dorel makes their objectives very clear:
    1) They want to be number 1 in sales - which is the same as saying
    2) They want to make tons of money

    What will they do to meet these objectives?

    If shortcuts are necessary...
    If labor is cheaper...

    When a company's main objective is to increase its wealth...well that sounds like mass production to me. And that usually leads to a lowering of quality.

    We really don't know what kind of people are in charge at Dorel. They may just have a heart, or they may just be a bunch of brainwashed marketeers in suits with $$ as their mantras.

    For me at least, it's hard to trust a person whos main talk is about sales.

    Cannondale is already #1 in my mind. All we can do is to continue to support the company that provides us with such goodies and backs them up(as long as they continue to do so).

  21. #21
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    Quote Originally Posted by xJAHx
    That was exactly one of my thoughts. This is all speculation, but imagine the disappointment of having a current carbon Rush frame, for instance, replaced under warranty with an outsourced frame?

    Sure, there are plenty of high end frames crafted in Taiwan, but when I purchased the carbon Rush, it was mostly because I wanted to support workers in the neighboring town, Bedford.

    I understand that Cannondale is a business that must be profitable to survive. Nonetheless, I sure would have liked a commitment for the manufacturing to remain here... We shall see.

    JAH
    I hate to break it to you but the current carbon Rush is in essence already an outsourced frame. It is already made in Taiwan. The wonderful workers in Bedford made your swingarm but that is about it. That doesn't mean it isn't a great bike, but there is a reason it doesn't say "Handmade in the USA" on it.

  22. #22
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    Ok ok, substitute the wife's Prophet 4x or my Caad5 track frame in for carbon Rush in the above post! >: )

  23. #23
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    The letter to the retailers does state that there will be no change in employees at Cannondale. That could mean they dont mean to change anything in their US based operation, or it could mean nothing.

    As far as mass marketed (i.e. walmart) bikes I dont see that happening. It would be business suicide for Dorel, as IBD's would en masse drop the brand. That is why only a few places carry Schwinn because they are also sold mass market.

    I do foresee that they will have bikes under a 1K pricepoint built overseas, as with Cdale's lower end mountain bikes as you just cant compete with asian sourced frames at that level. We can just hope that the outsourced price point doesnt creep higher every year as occured with Trek.

    Kevin

  24. #24
    All Lefty's, all the time Moderator
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    Quote Originally Posted by Dan Gerous
    Sounds good doesn't it?:
    Sounds like the typical hyped up marketing tripe every merger comes replete with, regardless of industry. It's meaningless to me. Actions, that's where the rubber hits the road, or, was it dirt....
    This is a Pugs not some carbon wannabee pretzel wagon!!

    - FrostyStruthers



    www.mendoncyclesmith.com

  25. #25
    LA CHÈVRE
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    Quote Originally Posted by MendonCycleSmith
    Sounds like the typical hyped up marketing tripe every merger comes replete with, regardless of industry. It's meaningless to me. Actions, that's where the rubber hits the road, or, was it dirt....
    Yes but for now, all we can do is speculate, we'll see down the road, or, dirt, what direction Cannondale takes. But I don't see this acquisition as a bad thing and will keep riding Cannondales for as long as they come out with products I want backed by their warranty. And people like you who can work on Lefties if needed too of course.

    I suggest to wait until they start to make bad moves before we complain about bad moves they could make eventually... And if they don't we can just keep riding and discuss, help each other out, show our rides with pride and whatever we do here.

    DAN.GEROUS.NET : MOUNTAIN BIKING : CYCLOCROSS : ROAD :

  26. #26
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    Quote Originally Posted by Flying Wombat
    The letter to the retailers does state that there will be no change in employees at Cannondale.
    "Leadership and employees aren't changing at Cannondale. Our Cannondale passion to support the Independent Bicycle Dealers."

    You’re referring to the above letter from Matt Mannelly to dealers. That statement I’m sure pertains to the employees that the dealer works with. IE, sales, customer service, etc. Not the guts of manufacturing.

    With Cannondale’s brand being so well known for handmade in the USA bikes, you’d think that Dorel would jump on the opportunity to ensure, specifically, that this part of the company (manufacturing processes) will not change if it were true. They didn’t. Face it, it’s outta here. .

    . . I hope I’m wrong.

    jeff

  27. #27
    All Lefty's, all the time Moderator
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    Quote Originally Posted by Dan Gerous
    I don't see this acquisition as a bad thing
    Nah, just wish that someone with a bunch of cash, and a passion for cycling had bought them, instead of something that smells of Walmart, despite promises to the contrary....
    This is a Pugs not some carbon wannabee pretzel wagon!!

    - FrostyStruthers



    www.mendoncyclesmith.com

  28. #28
    discombobulated SuperModerator
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    Quote Originally Posted by MendonCycleSmith
    Nah, just wish that someone with a bunch of cash, and a passion for cycling had bought them, instead of something that smells of Walmart, despite promises to the contrary....
    My powerball-megamillions tickets dont panout.... CDT, CEO and President...
    I think we will see this as a negative....eventually

  29. #29
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    A company will typically buy another company for their assets. What is Cannondale's biggest asset? Bedford! This could potentially be a big deal for Bedford. I know they currently make other aluminum products for other companies. Maybe they will start making some GT's here too? Either way it would be a huge waste to just dump a facility that has had millions and millions of dollars poured into it over the last few years. The people running Dorel (and Cannondale) are not stupid. The costs of bringing the manufacturing of their staple products (think scalpel, system / super six, caad9, etc) would be far greater than the returns they would get from doing so. I highly doubt anything but good will come out of this for Bedford.

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    Alright who wants a Prophet MX2?! Gotta sell that baby before it loses all of its resale...

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    Quote Originally Posted by MendonCycleSmith
    Nah, just wish that someone with a bunch of cash, and a passion for cycling had bought them, instead of something that smells of Walmart, despite promises to the contrary....
    Gosh Craig, the shop's doing so well, don't you have an extra $200 million kicking around?

  32. #32
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    Quote Originally Posted by Summit
    Alright who wants a Prophet MX2?! Gotta sell that baby before it loses all of its resale...
    Don't worry about it. If the doom-and-gloomers are right then your 'Made in the USA' Prophet will just become more valuable.

  33. #33
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    If Dorel really does allow Cannondale to be a separate division, wherein production remains in the states and infuses Cannondale with some cash to enhance its innovation and production, the buyout could be a good, even great thing.

    But if Dorel either a) moves all production overseas or b) markets Cannondales outside the IBD network, then it's over.

    As it is, Schwinn and Mongoose only really maintain high sales in the "IBD" industry because Performance carries them.
    Stop in at Element Sports. www.elementsport.com
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    Quote Originally Posted by rw420
    Don't worry about it. If the doom-and-gloomers are right then your 'Made in the USA' Prophet will just become more valuable.
    We can refer to those (Outsourced) as Cannondale AD. (After Dorel)
    And Cannondale BC. (the Before Cannondale). Get it, because it was the before Cannondale company. .I tried.

    jeff

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    As with any big or small company it's all about the bottom line. The good thing is my 07 Rush 3 will increase in value because it's made in America. Dang it, I've only ridden it twice and now I'm going to have to moth ball it because it's destined to be a collector's item. All kidding aside. If Dorel builds the best Mtn bike ever (20lbs, 6" travel, no pedal bob, laser handling, $999) and slaps a Cannondale sticker on it, there will be many of us buying them and raving about how great they are. Our LBS stand to be the biggest losers if Dorel decides to whore the name out to places like wal-mart.

  36. #36
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    Quote Originally Posted by rw420
    Gosh Craig, the shop's doing so well, don't you have an extra $200 million kicking around?
    Not after his most recent acquisition. darn near $200 million
    CDT

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    Firstl I hope this holds true.

    Matt Mannelly
    Leadership and employees aren't changing at Cannondale.

    I love my Cannondale bikes but I would rather loose the bikes than my job

    I agree that it seems like the name and reputation was a large part of that 200 million, I dont see the Cannondale name meaning much to your average Walmart/Target shopper so lets hope this works out to be a good thing, extra R&D money and more great bikes.

    regards
    Ray

    Quote Originally Posted by bad ronald
    A company will typically buy another company for their assets. What is Cannondale's biggest asset? Bedford! This could potentially be a big deal for Bedford. I know they currently make other aluminum products for other companies. Maybe they will start making some GT's here too? Either way it would be a huge waste to just dump a facility that has had millions and millions of dollars poured into it over the last few years. The people running Dorel (and Cannondale) are not stupid. The costs of bringing the manufacturing of their staple products (think scalpel, system / super six, caad9, etc) would be far greater than the returns they would get from doing so. I highly doubt anything but good will come out of this for Bedford.

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    I think this looks like a strategic aquisition. Dorel have some knowledge of this industry and believe its a sector they want to expand their presence in. Cannondale is an aspirational brand and I cant imagine they would want to damage it having paid $200m for it. I realise that the Made in America label is important to some but I suppose the real test will be how transferrable is the unique Cannondale welding technology and only secondly the mia tag.
    I think we should look to the bikes to get better wherever the frames are made, how about welded in US then shipped to far-east for assembly?
    Globalisation is America's gift to the world and there have been many benefits. Jaguar made its best cars ever under Ford and who'd guess I'd want to drive a BMW made in the USA

  39. #39
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    Quote Originally Posted by Baker921
    Jaguar made its best cars ever under Ford and who'd guess I'd want to drive a BMW made in the USA
    My Subaru was built in Indiana and it's still going strong at over 210,000 ticks...

    DAN.GEROUS.NET : MOUNTAIN BIKING : CYCLOCROSS : ROAD :

  40. #40
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    I am less positive after listing to the conference call

    I am less positive after listening to the conference call

    MARGINS lots of talk about Canondales margins, while much higher than there mass market stuff more is spent on R&D..... more R&D costs, more promotion cost, more advertising/marketing costs, bringing Cannondales actual margin down the Pacific divisions "BUT there are opportunities....."

    "Sourcing, we have an extensive ...uh... experience in the sourcing end of ...uh... this business and significantly ...uh... more I think than the current Cannondale team particularly ...uh... in the Orient, Taiwan or any of those area's"

    Manufacturing is also also being looked at "you know balancing ...uh... between what's made in in China, or Taiwan and what will be made in the US"

    http://webcast.newswire.ca/archive/d...el20080204.wma

    Ray

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    Quote Originally Posted by Dan Gerous
    GT, Schwinn and Mongoose went down and hard before they were bought by Pacific and are now doing much better than they were before
    Exactly! I'm stoked about this. They are interested in Cannondale for Cannondale...they'll keep doing what they are doing I think except now they'll have better marketing and more locations, not to mention better funding for better bikes! I know most of you disagree, but time will tell.

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    Dorel paid 200 million for a great name and a great distribution chain. That is worth more to them than a nice factory that can be easily liquidated.

    I am betting they are going to follow the Specialized model of producing nothing and outsourcing absolutely everything to asia in an effort to streamline operations and cut costs and marketing very hard. It's been working for Specialized and Specialized is no different than Schwinn that Dorel owns except for their name and wonderful marketing. It is sad to me and Specialized is a company I would never buy anything from due to their tactics. I hope Dorel does not follow suit but I am guessing if they want to take on the giant that is Specialized they will need to do just that.

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    Well, that's just great. Here I am thinking I will pay a little to upgrade my frame replacement for the carbon rush. (was going to the lbs to do this tommorrow). It feels like a more comfortable and more efficient ride. But, now I feel compelled to settle for the aluminum rush to support the 'made in the usa' line and hopefully keep Cannondale in the US.
    Perfect timing!?!

  44. #44
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    Quote Originally Posted by az1jeff
    With Cannondale’s brand being so well known for handmade in the USA bikes, you’d think that Dorel would jump on the opportunity to ensure, specifically, that this part of the company (manufacturing processes) will not change if it were true. They didn’t. Face it, it’s outta here. .
    GT was well known for being USA made until they went bankrupt too... so what, Dorel should buy a brand, let it go suck revenue away and do nothing about it? Crack'n'fail had been moving a lot of production offshore for years anyways.
    I don't post to generate business for myself or make like I'm better than sliced bread

  45. #45
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    Quote Originally Posted by bad ronald
    it would be a huge waste to just dump a facility that has had millions and millions of dollars poured into it over the last few years. .
    Believe me, huge corporations could care less about shutting down a billion dollar operation here in the USA. If it means they can show a meager one or two million a year in savings outsourcing overseas. Happens ALL the time.

    .. Again, I hope I'm wrong.

    jeff

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    Quote Originally Posted by DeeEight
    Crack'n'fail .
    I don't feed trolls.

    jeff

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    All I care about is that they keep Cannondale a good top notch brand. Oh and It is also sweet that the LBS I work at is a GT, Schwinn, dealer, which now means.... Employee Purchase on Cannondales!!!! oh yeah. Maybe Dorel will come out with a righty to switch things up?

  48. #48
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    Cannondale's acquisition would be 10% of dorel's business. Of that the factory probably compromises 30-40% of that value. Not something really worth throwing away. Also note that the presentation of the sale was done at the factory in front of all the employees. The company is too small and there are too many close relationships for the head of the company to just make a two faced statement. I for one believe the factory will be staying open and they will be turning out more product than ever.

    As for margins, that is an important part of any business. Lower margins = less opportunity for developement, marketing, and higher prices for consumers. Think about it, if GT bought 5000 pairs of XTR cranks and Cannondale bought 5000 pairs they will both be paying more money for them than if they bought 10000 pairs in one shot. That is where sourcing is critical. Components are a huge part of the cost of a bike. They are also typically made in Taiwan and China so this is a big reason why those regions are spoken about so much. There are so many cool things that could come out of this that everyone needs to calm down and wait for things to take place before you give your Cannondale the heave-ho.

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    Cross breeding

    I can't wait for the '09 Prophet I-Drive and the Lefty Carbon equipped Zaskar.

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    Does this mean the Cannondale forum is going to be merged with the GT Forum or worst yet the Mongoose-Schwinn forum?

  51. #51
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    Good job!

    Not being negative but they can only improve!

    Everything they made broke maybe now it won't

    Will we see Craig Mendon bolting I drives on C dales?

    Hope they work out for the better!



  52. #52
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    I don't see the acquisition a bad thing so far. If that means more resources for R&D and improve the brand's potential on a market poluted by Big S's (tried to make a lame joke here... oh, boy ), then that can be a good thing. I wouldn't say Cannondale is going to lose track, since the guys who make and put the bikes to run are still there. I don't think Dorel will swap the main production overseas, since Cannondale already have all their resources in the USA. But if so, then we would return to that old Taiwan/China melee. Anyway, I still dig the company's philosophy; in fact I've just got a brand-new, 3-times used around the block 2006 Prophet, and couldn't be happier. And new models are to be presented in a couple weeks. I think there's a good chance for Cannondale to be on the way for the top 5 brands in the world. If that can be acomplished without any compromises to fabrication standards and QC, which I honestly think that there won't be any major issues to be concerned about, Cannondale will be the best among the best.

  53. #53
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    Thanks Ray for the link to the conference call: http://webcast.newswire.ca/archive/d...el20080204.wma

    To expand on Ray's quote of the call in regard to those of you thinking that this is good for Bedford, go to mark 13:30...

    Question: "Another clarification on the current manufacturing of Cannondales, is it mainly US or what kind of split is it, the US vs. outside?"

    Dorel: "It's mainly US, ummm, and we are going to be looking at that. You know, balancing, uhh, between what's made in in China and Taiwann and what will be made in the US."

    No need to speculate; the powers have spoken.

    JAH

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    Hope for the best

    They quote Trek and Specialized as the top 2 players, but I think they haven't considered Giant as the major bike company in the world production-wise, and haven't met the same thoughts about Scott in Europe and their advanced carbon fiber R&D.

    Specialized is experiencing a bad time with their own brand's forks and shocks, and that is a reflection of a mass production standard going bad. If to face Specialized, Cannondale have to take the same measures, either we'll be seeing below average high-end bikes or see more problematic designs and products. That's mass production at its extreme for maximum profit. That won't work for Cannondale and it's philosophy for great products. Trek has been currently known for their advanced development for their US made high-end line of bikes, and that may be the better way to go for Cannondale. Not Specialized's.

    But I'm less excited about this and a lot more concerned after hearing the conference report. I won't start to trash it out before seeing the real consequences of this new status for Cannondale, but I must admit I'm a bit scared now. I'm hoping for the best.

  55. #55
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    Quote Originally Posted by wvnova
    now I feel compelled to settle for the aluminum rush to support the 'made in the usa' line and hopefully keep Cannondale in the US.
    I don't think that will matter for such a company like them, at least not at this moment. You can start your own inner revolution by upgrading to a proven desing of an improved product like the Carbon Rush and enjoy it to the most. Because, in the end, you'll realize it won't make any difference keeping your old bike to support the MIUSA status, since bikes are not made by us, but offered to us. Don't avoid purchasing a great Cannondale bike like the Carbon Rush because of today's news, but for what it is now, and considering it was made by the good and old Cannondale tech guys. If good bikes like this one never come out again, you'll feel good to have it. But if Cannondale do great under Dorel and better bikes bikes come out, then the bet will be paid off. Go for it, man!

  56. #56
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    Just an FYI not everything they made broke, we have 3 that are all working perfectly.

    Guess I am just lucky

    Quote Originally Posted by NEPMTBA
    Not being negative but they can only improve!

    Everything they made broke maybe now it won't

    Will we see Craig Mendon bolting I drives on C dales?

    Hope they work out for the better!



  57. #57
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    So does this mean that Cannondale won't be made in the USA anymore?

  58. #58
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    Too few of us value American-made product enough to pay the extra cost.

    I worked for Dorel back when there were 3 of us in the bike division making tricycles. Worst experience ever.

    But if I'd kissed arse and hung in there, I might be lead designer of GT, Schwinn, and Cannondale today!

    Oh, well.

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    As soon as this announcement was made, my '06 Prophet 600 began to disintegrate! Its a good thing I left that protective layer of dirt on it, or I wouldn't be able to find it today.

    Rather than repeat the pro and con of THE PURCHASE, and the comments thereof, does anyone know how this will affect the involvement of Lebron James with the Cannondale brand? Presumably he was associated with the previous owners and would be in line for a substantial cash out. It will be interesting to see if the new owner feels that his participation will be valuable and to what lengthes they will go to to maintain a relationship. I think this might be a good indicator of which way this transaction might bode for the brand. I could be wrong, and frequently am.

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    Here's a link to the recorded conference call in case it wasn't posted yet.

    http://www.newswire.ca/en/webcast/in...nyID=796760125

  61. #61
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    Quote Originally Posted by D.F.L.
    Too few of us value American-made product enough to pay the extra cost.

    I worked for Dorel back when there were 3 of us in the bike division making tricycles. Worst experience ever.

    But if I'd kissed arse and hung in there, I might be lead designer of GT, Schwinn, and Cannondale today!

    Oh, well.
    This is the key. We vilify the corporations looking to expand profit by moving manufacturing overseas and maintaining or increasing the price, but customers are the ones to blame because they will still buy.

  62. #62
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    No offense but listen to most of you talking about this situation. Its been a day since they "purchased" Cannondale and you guys are all ready expecting the worst and bashing a company in which you once loved (and I still love and respect). Just because Dorel also owns Pacific who we all know isnt the best bicycle company, doesnt mean they will do the same for Cannondale. Its simply another investment firm. To me, they havent changed and will probably only get better. Most of the effects, if there are any, wont fall into place until June. Please dont expect the worse until it has actually happened. If it does actually happen, then you may "rub it in my face" if you wish to do so.
    Bikes

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    I just got done listening to the conference call from yesterday and I really don't see too many negatives. Actually Cannondale may have some opportunities. First, the good news is the acquisition was accretive day one even without Dorel's future synergies with distribution and other resources.

    The CEO of Dorel emphasized repeatedly that the entities will remain separate. The Cannondale line will be only in bike shops, not in mass merchant stores. They have enough lines in the mass market and Cannondale gets them into the other market. With stronger capital available, Cannondale could actually see improvements in design, R&D, and ultimately provide quality bikes for less than before.

    I say so what and I'm happy that I just bought a Cannondale. Sure mine is a lowly made in Tawain frame (F5), but I am enjoying the bike for sure.

  64. #64
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    Originally Posted by wvnova
    now I feel compelled to settle for the aluminum rush to support the 'made in the usa' line and hopefully keep Cannondale in the US.

    Quote Originally Posted by Black RONIN
    I don't think that will matter for such a company like them, at least not at this moment. Because, in the end, you'll realize it won't make any difference keeping your old bike to support the MIUSA status, since bikes are not made by us, but offered to us. Don't avoid purchasing a great Cannondale bike like the Carbon Rush because of today's news,
    Said the guy from BRAZIL. But it does matter to the folks here in the USA. And you better believe Cannondale would notice if the sales of the Taiwanese models fell to zero while the model's sourced here in the USA surged.

    jeff

  65. #65
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    Quote Originally Posted by TheProphet
    No offense but listen to most of you talking about this situation. Its been a day since they "purchased" Cannondale and you guys are all ready expecting the worst and bashing a company in which you once loved (and I still love and respect). Just because Dorel also owns Pacific who we all know isnt the best bicycle company, doesnt mean they will do the same for Cannondale. Its simply another investment firm. To me, they havent changed and will probably only get better. Most of the effects, if there are any, wont fall into place until June. Please dont expect the worse until it has actually happened. If it does actually happen, then you may "rub it in my face" if you wish to do so.
    You're quite right, but since many of these giant investors only have profits in mind, and having their spokesman saying they will balance productions, it gets pretty hard on our faces that they are only thinking mainly about money. Ok, I'm with you that we can't simply stop honoring Cannondale, and I won't. But we have to hope for the best, that they can understand what a Cannondale bike means and only make it better for everyone.

    But I do think GT is a bit better now; What cannot be accepted is that some new experiments which may bring QC down take any place, like what happened to Specialized when they turned out Fox and started developing their own forks and shocks at one-fifth of the cost at some low end suspension facilities. I would not EVER get a Cannondale which I could't entirely trust like today's models and components offered by the current Cannondale lineup. That's why a Lefty is so expensive compared to regular forks, even Fox's. If one likes the Lefty or not it's another story, but its quality level is undeniable. Hope Dorel really think what is important to keep Cannondale being Cannondale, and not taking some obscure decisions that may lead the brand to get closer to more popular brands at a quality cost. That's why we have to take a closer look at this and see what will happens in medium and long terms.
    Last edited by Black RONIN; 02-05-2008 at 12:03 PM.

  66. #66
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    Remember that Pacific cycles bought GT back in 01, and Dorel bought Pacific in 04. Compare the bikes GT put out prior to 01, the ones from 02-05, (assuming the first year under new ownership basically just carried over the previous year's models) and the stuff GT is putting out now.
    They are making good bikes again, but they are hampered by the years they spent in purgatory.
    Also, GT wasn't in bad shape when Pacific bought them. They had just dumped a ton of money into R&D for the i-Drive, and they had just purchased Schwinn. Plus they spent a ton on the olympic SUPERBIKE. Then the CEO, Richard Long sadly passed away in a motorcycle accident.
    Shareholders sold GT out based on lack of confidence in a company without Mr. Long's leadership.

  67. #67
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    Well...

    Tool on over to the GT forum and there is very posting and support over there!

  68. #68
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    Quote Originally Posted by az1jeff
    Said the guy from BRAZIL. But it does matter to the folks here in the USA. And you better believe Cannondale would notice if the sales of the Taiwanese models fell to zero while the model's sourced here in the USA surged.

    jeff
    Jeff, as usual, you're wrong about me and about what I said.

    You, as a person, and that counts for any regular american citizen, want to honor inhouse production, and I think that's great. I do. But you have to be more realistic at this. You sound like you don't like and care for Cannondale's bikes qualities, but only origin. That may count for some brand that doesn't have the status Cannondale have and more, the QC Cannondale have for their bikes. You are free to complain about Giant or Specialized, which throw bikes at people like they were pancakes. But not for brands like Cannondale, and in a lesser scale, Yeti, Tomac, Maverick, Santa Cruz and many others who only choose having their frames built in Taiwan to extend and improve production, but watch closely every fase of the project. I really think there's a difference when we talk about it. But we already had this discussion back there, when many feared that Cannondale would lose track when the Taiwan-made frames started to pop in.

    Dorel, as an investor company, may now take the lead in many fields inside Cannondale, including production and R&D. That may cause a strong impact, positive or negatively, but it's still too soon to tell.

    I recomended Wvnova to get his Carbon Rush, because if this Dorel situation had never taken place, Cannondale wouldn't be in the spotlight and the Carbon Rush would still be as good as any other Cannondale bike, and it IS. That's the point. We can't start to frame our HMIUSA bikes as a good memory of Cannondale golden times and hang them on the wall. Let it be, let's see what's gonna happen. If they (Dorel and, why not, Cannondale ) screw things up, just don't buy the bikes anymore. But up to this moment, Cannondale is still the same, and so are their bikes. That's still a good thing, don't you think?
    Last edited by Black RONIN; 02-05-2008 at 12:08 PM.

  69. #69
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    Quote Originally Posted by Black RONIN
    Jeff, as usual, you're wrong about me and about what I said.

    You, as a person, and that counts for any regular american citizen, want to honor inhouse production, and I think that's great. I do. But you have to be more realistic at this. You sound like you don't like and care for Cannondale's bikes qualities, but only origin. That may count for some brand that doesn't have the status Cannondale have and more, the QC Cannondale have for their bikes. You are free to complain about Giant or Specialized, which throw bikes at people like they were pancakes. But not for brands like Cannondale, and in a lesser scale, Yeti, Tomac, Maverick, Santa Cruz and many others who only choose having their frames built in Taiwan to extend and improve production, but watch closely every fase of the project. I really think there's a difference when we talk about it. But we already had this discussion back there, when many feared that Cannondale would lose track when the Taiwan-made frames started to pop in.

    Dorel, as an investor company, may now take the lead in many fields inside Cannondale, including production and R&D. That may cause a strong impact, positive or negatively, but it's still too soon to tell.

    I recomended Wvnova to get his Carbon Rush, because if this Dorel situation had never taken place, Cannondale wouldn't be in the spotlight and the Carbon Rush would still be as good as any other Cannondale bike, and it IS. That's the point. We can't start to frame our HMIUSA bikes as a good memory of Cannondale golden times and hang them on the wall. Let it be, let's see what's gonna happen. If they (Dorel and, why not, Cannondale ) screw things up, just don't buy the bikes anymore. But up to this moment, Cannondale is still the same, and so are their bikes. That's still a good thing, don't you think?
    That's what I'm saying too. People are crucifying Cannondale/Dorel for something that hasn't happened or even been planned yet. If they screw up down the line, fine, whine and complain but you'll have every right to do so. But right now, why cry like school girls? For those who have kids, do you shout at them and punish them for something you think they might, maybe, do in 2 years?

    DAN.GEROUS.NET : MOUNTAIN BIKING : CYCLOCROSS : ROAD :

  70. #70
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    Quote Originally Posted by Black RONIN
    Jeff, as usual, you're wrong about me and about what I said.
    Forgive me if I don’t reply in detail, as I’m busy working on that whole “making a bike on my own and seeing if my "american" welding skills outfits the worst made in china frame in the Walmart shelves.”

    Wrong you say?? You’re not in Brazil?

    I “sound” like I don’t care for Cannondale and their quality? I don’t think so. But nice try.
    Last edited by az1jeff; 02-05-2008 at 12:34 PM.

  71. #71
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    I like the HMiUSA sticker on my SuperV and Prophet but the clues were in the conference call. 40% of sales are in Europe and the margins here are much larger in the US. With sales in the rest of the world as well I guess 60% of profits already come from exports. Brand values are what count not not the location of the frame fabricators or final assembly (Holland for 40%). In Europe we have already got used to the idea that manufactured products have a global origin. Free makets only work if consumers choose the "best" products.

  72. #72
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    In Cannondale's case, Made in USA would mean that Cannondale will continue to employ US workers while all profits from operations are shipped out to Canada. In Specialized and Trek etc. case, bike companies employ Taiwanese/Chinese workers and factory owners while profits from operations are booked by US corporations.
    So you either support the US worker and enrich the Canadian business owner or you support the Taiwanese worker and factory owner while enriching the US business owner.
    Ideally, if the dollar continues to weaken and some currencies are uncoupled from the greenback, US businesses with US production will flourish to meet a growth in international demand.

    Or you just ride what you want and let the chips fall where they may.
    Last edited by kabayan; 02-11-2008 at 09:53 AM.

  73. #73
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    Dorel is corporation built on outsourcing. They purchased Cannondale yesterday. Now if a private investor who rides, and LOVES Cannondale bikes made the buyout, which would be different. But that’s not the case unfortunately.

    Wait two years?? What about the current changes prior to the sale?? It’s already begun. Up until 2007-2008, Cannondale was company that built quality, handmade in the USA bicycles. This was its brand and its image globally. Suddenly they introduced Chinese and Taiwanese models, eliminated the unique and celebrated Lefty from the trail bike line Prophet altogether, offered more carbon Taiwan Rush’s than USA aluminum Rush’s and only ONE with 110 Lefty. With the news of the sale of the company, I think it’s obvious that all these untraditional, un-Cannondale like changes were to sweeten the deal for the potential buyer Dorel. Dorel is a company synonymous with outsourcing. Now you want to talk about being realistic? Look historically at Dorel /Pacific as a company and it’s track record. It speaks for itself. I think it’s obvious to say that all of this is legitimate cause for reaction, no matter who you are. The changes have begun and I’ll argue it’s to satisfy Dorel and the direction they want to take the company.

    What does all this mean? Evidently not much to someone in Brazil, or Canada, or anywhere else outside the USA. But it does mean something to a few people here in the USA judging by some of the responses within this thread. To the American consumer like myself, it means the potential loss of another option to buy a product (bicycle) that’s made here in the USA. To those consumers globally, all that’s it stake is a bike and potential quality/warranty issues. But there’s a little more at stake for those employees at Cannondale don’t you think? I know it (changes, buyout) means something to the Cannondale employees in Bedford, Pennsylvania. Those employees built Cannondale and it would anger me to see them shown the door by a huge bottom-line eying, share holder appeasing, multi-national corporation that cares nothing for jobs, the USA, or people for that matter, but just the bottom line. I understand that nothing has happened and no one has been given a pink slip yet, so I guess we’ll see. One more time: I hope I’m wrong.

    jeff

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    I'll take issue or make a correction on one point Jeff. The reason the lefty went away from the Prophet line is that Hayes purchased Manitou, bought production back Stateside and was no longer interested in producing the TPC or SPV cartridges for the Lefty Max. With two new trail bikes in the works it made sense for Cannondale to put Fox forks on existing Prophets and move ahead with the Lefty 130 with Fox internals for the new trail bike line.
    Carbon Rush frames 1-3 are Carbon, but the 4-6 continue as alloy. At least the swingarm for all is made in Bedford, as is all the painting and finishing. The only bikes that never see Bedford currently are the CO2 series.

    I for one will wait and see how things play out. Lets no assume this means total outsourcing in the future, although with overall corporate history in the US I also understand peoples concern 100%. Having said that I am currently riding on a overseas sourced Carbon Rush frame, and have to say that the quality and ride is pretty damn good and I dont regret my decision to purchase it.



    Kevin

  75. #75
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    And Dorel are not necessarily 'all about outsourcing', they bought companies that were already outsourcing. As we all(most) know and agree on now, at lower price points, consumers don't care if the frames are built in the US or China or Brazil, all they care about is low prices. So for lower end bikes like the big-floor-stores intended bikes Pacific has, outsourcing makes sense as it does with lower priced Cannondales. High-end Cannondales that are outsourced like the carbon Rush and Taurines were outsourced because Cannondale couldn't make them in their own US factories at the time so they had them made elsewhere but still have a very high quality. Owners of those bikes could tell you: they are great bikes! They would probably not have happened if not outsourced, certainly not at the time they were released.

    DAN.GEROUS.NET : MOUNTAIN BIKING : CYCLOCROSS : ROAD :

  76. #76
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    Quote Originally Posted by Flying Wombat
    .
    Carbon Rush frames 1-3 are Carbon, but the 4-6 continue as alloy. At least the swingarm for all is made in Bedford, as is all the painting and finishing.
    Are there Cannondale bikes outsourced now?? Yes. That's my point. One is too many if you asked me. Sudden and un-Cannondale like changes to satisfy Dorel.

    Let me ask you this: Do you think the number of outsourced models will increase, decrease, or remain the same?

    You a dealer? I see you're sponsored by Paragon, a Cannondale dealer.

    jeff

  77. #77
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    Quote Originally Posted by Dan Gerous
    As we all(most) know and agree on now, at lower price points, consumers don't care if the frames are built in the US or China or Brazil, all they care about is low prices. .
    . . .That's YOUR opinion. The American consumer is forced to believe the hype and nonsense about how outsourcing will lower the prices. Sure, for the first couple years. Then they gradually outsource ALL the models. What are we left with? No choice and the prices climb right back up a la Specialized. That's my problem.

    You a dealer DG?

    jeff

  78. #78
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    Quote Originally Posted by NEPMTBA
    Not being negative but they can only improve!

    Everything they made broke maybe now it won't

    Will we see Craig Mendon bolting I drives on C dales?

    Hope they work out for the better!


    IS there a thread in here your not going to troll in?
    I hope this whole 'sale' thing dies down soon.
    I hope for the best, but remain pessimistic.........On two fronts

    btw : http://www.trekbikes.com/pdf/recalls...220_recall.pdf
    Trek recall???? Can't be.....Trek' n 'fail ?

  79. #79
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    Quote Originally Posted by az1jeff
    Are there Cannondale bikes outsourced now?? Yes. That's my point. One is too many if you asked me. Sudden and un-Cannondale like changes to satisfy Dorel.

    jeff
    Yes, I'm from Brazil.

    Kid, if it's so much of a deal for you, why do you bother? Either you love Cannondale way too much or you're just exercising your patriotism the wrong way.

    I worked marketing-wise for large companies, and believe me, they could care less about people like you and me. You can cry, you can dance and spin, you can send them bombs or flowers, and even write and sing a beautiful song about how you feel. That doesn't matter. If Dorel make changes to Cannondale in order to have a better acommodation in behalf of their production process, you gotta trust me, it will be done in a snap shot. It's nothing personal, it's just business.

    Get over it, kid. Live on. Wanna get along with uncle Sam? Pay your taxes on time or be a politician. But if you wanna ride bikes, hop on one you like and ride it. Wanna the MIUSA status? You have a lot of brands keeping your dream alive. But now, if it's all about Cannondale, then all you can do is to cope with the situation. Unless you have a spare US$200 million and get it done yourself. If not, you're just another consumer. Get used.

  80. #80
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    Quote Originally Posted by Dan Gerous
    And Dorel are not necessarily 'all about outsourcing', they bought companies that were already outsourcing. As we all(most) know and agree on now, at lower price points, consumers don't care if the frames are built in the US or China or Brazil, all they care about is low prices. So for lower end bikes like the big-floor-stores intended bikes Pacific has, outsourcing makes sense as it does with lower priced Cannondales. High-end Cannondales that are outsourced like the carbon Rush and Taurines were outsourced because Cannondale couldn't make them in their own US factories at the time so they had them made elsewhere but still have a very high quality. Owners of those bikes could tell you: they are great bikes! They would probably not have happened if not outsourced, certainly not at the time they were released.
    I hardly believe that Cannondale will turn into another Specilaized. But changes are always part of a company's evolution. And Cannondale's no different. Changes doesn't mean old good things turning into trashy new things (philosophic insight: were they all that good or just our nostalgic feelings that make we recall them as the best things in our lives? Think about it! ). That's a new chapter. That can only be a matter of investment, which could do a tremendous good to Cannondale. I believe that a so strongly stabilished company like Cdale won't sell themselves for the highest bet just to turn their backs to their consumers and run away to spend a lifetime vacation on Aruba. Not at all.

    Outsourcing could be an ongoing process with or without Dorel in the playfield. That's not a disturbing fact. Outsourcing can be a good thing when followed closely. I defend Cannondale to do whatever it takes to keep the QC and their R&D in the highest level to deliver a top notch product. It doesn't matter. They have a global market to attend, and if they keep that so narrowed, they only gonna sell a bunch of bikes for those MIUSA purists which actually only want to keep their ego inflated no matter what, and do not care about new products' design and production costs, which involves a lot more intricacies than anyone can ever imagine. And Cannondale have done the impossible so far, we have to be thankful that they could pull off so many wonderfull bikes, and two more on the way, without losing track of their commitment with consumers. I understand that they reached a break-or-go situation where they choose to keep going. I agree with them.
    Last edited by Black RONIN; 02-05-2008 at 07:23 PM.

  81. #81
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    Quote Originally Posted by az1jeff
    Are there Cannondale bikes outsourced now?? Yes. That's my point. One is too many if you asked me. Sudden and un-Cannondale like changes to satisfy Dorel.

    Let me ask you this: Do you think the number of outsourced models will increase, decrease, or remain the same?

    You a dealer? I see you're sponsored by Paragon, a Cannondale dealer.

    jeff
    There have actually been outsourced models in Cannondales range, beginning with the Synapse I believe for a while. Yes I am sponsored (and work part time) by Paragon and we carry Cannondale. I dont "know" anything, but my best guess is the Cannondale may do a Trek type move with everything below a certain price point say 2000 dollars made overseas and only the higher end bikes made in the US. I can say one thing for sure if they started turning up in the Big Box stores then Paragon will for sure drop them as a brand like a hot brick as will a bunch of the IBD's.

    My biggest fear at this point would be consolidation of models. For example GT/Cannondale/Schwinn all having the exact same bike, just different decals. A Freedrive Rush with a Lefty anyone...... Blechhh.

    In the end though for me its just a bike, not a religion, so if Cannondale dont make anything I want to ride then I will look for another company who does.

    Kevin

  82. #82
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    Whats with all the doom and gloom. At least wait and give Dorel a chance before jumping to conclusions. Anyway, globalisation is no longer a theory, its a fact so get use to it. Not even the largest economy in the world can hide from globalisation...... On a side note, I'm suprised Dorel have purchased during the economic hardship that the USA is currently experiencing, current times are anything but stable. Whatever happens, I'll still be buying 2 new 2009 Cannondales because I'm am tied to the brand and their reputation. Dorel arn't stupid, they know Cannondales reputation alone is worth the $200 million and to stuff with it would not be in their or the consumers best interests. In my opinion, the reason why brands like Specialized have increased in price is because they are trying to turn Specialized into a premium brand so they put the corresponding price tag that goes with a premium brand, not because production costs have drastically gone up (although they probably have some).

  83. #83
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    Quote Originally Posted by az1jeff
    . . .That's YOUR opinion. The American consumer is forced to believe the hype and nonsense about how outsourcing will lower the prices. Sure, for the first couple years. Then they gradually outsource ALL the models. What are we left with? No choice and the prices climb right back up a la Specialized. That's my problem.
    f

    Eh Jeff , there is a lot of "boutique" frame builders in the US. Just buy one.
    So you'll be sure that your frame is really MiUSA. You won't have that luck with 98% of all the other parts on your bike though........

    Personaly , I ride CDale for their fork , so I would ride them even if it would be made on Mars......

    My 1fg/fork is US made , my transmission is german ( Rohloff) , Rims are french , brakes are England (Hope) , saddle england ( Brooke ) , I'm sure I have some Taiwanese parts, So what !!!!!!!

    It's the best ride I ever had .
    "There is a big difference between kneeling down and bending over" -FZ

  84. #84
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    In the end though for me its just a bike, not a religion, so if Cannondale dont make anything I want to ride then I will look for another company who does.

    Kevin

    Well sead,
    You got to ride um hard & put um away wet!!!

  85. #85
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    So cannondale was bought buy a large company that is profitable and a good business plan. Beleive it or not that could be a good thing. Cannondale has been on the upswing for several years now since the motorsports debockal and has always been for sale. The cannondale of old (Montgomery) has long since past and moved on.

    As far as bike imports goes they have been doing that for a while now with much success, Synapse, Tauring and the Carbon Rush. All awsome bikes that get rave reviews. What seems to be missing in all of the threads i have read, and excuse me if i missed it, the only way that cannondale can really continue to compete and be profitable is to import some of their stuff. Lets face it everybody else has been doing this for a long time but nobody seems to care, and what makes it even better is, and maybe most dont realize this, is that most of these companies source GIANT to manufacture some or all of their bikes.Then of course you have the four flavors of vanilla that TREK serves up (TREK,FISHER,LEMOND,KLEIN), as well the only real refinements in their line in the past ten years has finally comme to light in 2008.

    I for one love cannondale but carry no animosity toward any other brand. My road bike is a System/SIx, My moutain bike is a Homegrown, my comuter is a Fixi conversion, and my family bike is a GT. My wife Rides a Giant on the road and my son rides a GT on the trail.

    My only real problem is with those that would find pleasure in getting a rise out a fellow cyclist.

    Now as far as Dorel goes they have done wonders with the GT line. The bikes get better every year and are usually at a much better value that those of other brands. I have high hopes for Cannondale and look foreward to seeing how this all plays out.
    Last edited by rocketritch; 02-06-2008 at 08:39 AM.

  86. #86
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    Quote Originally Posted by mungoman58
    On a side note, I'm suprised Dorel have purchased during the economic hardship that the USA is currently experiencing, current times are anything but stable.
    True and I agree with your comments about globalization. However, I think a driver might have been the strength of the $CAD over the $USD. In February of 2007, the $CAD was $0.84 to $1 USD. Now it is basically even, giving CAD companies better buying power. In addition, perhaps that's why they were able to experience $0.09/share accretion immediately is because Cannondale sold at a "bargain". Either way, I'm curious and optimistic that the cash infusion and synergies created by this acquisition could really greatly improve Cannondale in R&D, design, price, etc.

  87. #87
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    Been reading through this thread and I think too many people are getting to emotional about nothing at this point.

    If you sat in on the telecom it was made clear that Cannondale will be operated seperately from Pacific Bike, which is being positioned as the middle to lower tier product line for Dorel.
    Cannondale was bought to provide a top tier product, name and add a touch of quality and class to Dorel's Sports Group aspirations.

    Sure it may come to pass that the Bedford factory will close or at best be made smaller but we knew that this was going to happen anyway since more production was being moved to the east. This trend is industry wide and therefore Cannondale has to compete.

    However at the top end of the market where Dorel wants Cannondale to play you will find that there is still a market for Hand Made in USA, whether it be Carbon or Aluminium.

    Chatting to my local distributor, I was told very clearly that there will be no change in the way of doign business and with whom, i.e. distributors will remain as they are. The push will go into R&D and Marketing for technologies that Cannondale has been unable to exploit due to insufficient capitol since the Chapter 11 incident. This gives them an opportunity.

    Fact; Cannondale make some of the finest Alumiium bicycles on the planet
    Fact: Cannondale make some of the finest commuting bikes on the planet
    Fact: cvannondale make some of the finest road bikes
    Fact: Cannondale Make some of the Finets MTB.


    Why would an investor/owner want to mess with a winning formula.
    With more investment wil come efficiencies and some of that will involve outsourcing.

  88. #88
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    Look at the bright side. At least Huffy didn't buy them.

  89. #89
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    Quote Originally Posted by Black RONIN
    Yes, I'm from Brazil.

    Kid, if it's so much of a deal for you, why do you bother? Either you love Cannondale way too much or you're just exercising your patriotism the wrong way.

    I worked marketing-wise for large companies, and believe me, they could care less about people like you and me. You can cry, you can dance and spin, you can send them bombs or flowers, and even write and sing a beautiful song about how you feel. That doesn't matter. If Dorel make changes to Cannondale in order to have a better acommodation in behalf of their production process, you gotta trust me, it will be done in a snap shot. It's nothing personal, it's just business.

    Get over it, kid. Live on. Wanna get along with uncle Sam? Pay your taxes on time or be a politician. But if you wanna ride bikes, hop on one you like and ride it. Wanna the MIUSA status? You have a lot of brands keeping your dream alive. But now, if it's all about Cannondale, then all you can do is to cope with the situation. Unless you have a spare US$200 million and get it done yourself. If not, you're just another consumer. Get used.


    I don’t understand? You seem to be simply repeating what I’m saying regarding Dorel’s possible direction??

    Maybe you should save the patriotic lectures for your homeland Brazil. It doesn’t mean anything to me.

    It says a lot that some can simply state that Bedford will close. No big deal. Like somebody closing a 7-eleven. Just like that.

    Not much more to say but wait and see and observe. Observe what may or may not happen in Bedford, And observe the coming model changes. . .

    jeff

  90. #90
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    Quote Originally Posted by mathewsen
    Nimrod, the biggest mistake you made was selling your F29. back to your cave.
    Hehe... it was a great bike, and it is still sort of in the, "family". I would have kept it and it would have had several thousand miles on it by now, but that damn bottom bracket was just too low for me.

    In fact, I never planned on it being my daily singletrack rider, but I like it so much that I was trying to use it as that. For a touring ride, GREAT. For an everyday singletrack bike on the trails I ride, not so great with the low BB.


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    Lots of good news in the press conference!

    I listened to the press conference. Sounds like they respect quality and service. They want money for it, but it's something they're enthusiastic about. Take (some of) my money if I can go to any Cannondale dealer and get my 'annual' service for my Lefty done.

    Also, did anyone pick up on the part about how they won't be strong-arming LBS like other companies. Dealers will want to stock Cannondales. If that works, great. I think the LBS owners will really appreciate that business model.
    My bicycle gets more dirt than your 4x4.

  92. #92
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    yeah that part was a bit confusing since strong arm tactics ar what everybody uses.

    What makes it attractive for a dealer to stcok a bike is low wholesale price, high recommended retail selling price. That way they can play with margin by either down specing or mixing and matching parts as per customer needs.

    All this points to inproved efficiency and clearly a better balance in offshore production vs local production.

    Either way, It the concepts I saw in 2003 hit the shops in 2009 then I'm pretty sure that dealer will want to stock a Cannondale. Some really radical concepts on the drawing board.

    Lets make sure that our voices, we the end user get heard and make it very clear that we want Cannondale to remain the brand it is.

  93. #93
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    employees

    remember, we as Canadians and Americans have heat in the winter, air conditioning in the summer and wages that can afford us usable cars and great hobby bikes. most of the people in manufacturing in the countries where our manufacturing is outsourced to may not. not only is labour underpaid but also safety is lax and human rights are questionable as is free speech. these are issues accepted and lived with.
    i love my prophet and will continue to buy if it remains made in USA. i will not if manufacturing moves to a country where i would not feel safe, comfortable, and free in.
    Price and profit through oppressive dealing is not what America and Canada or any empathetic and fair thinkers have built our countries on

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    Here is something you might want to think about.

    Pacific Cycles and Performance Bike Shop have a very strong relationship. Margins on Cannondales (as with all bikes) are very thin. What will happen once Performance starts flexing its muscle? Prices will go down, but at whose expence? Your local C'dale dealer should be worried if they have a Performance near by.
    Just my 2 cents.

  95. #95
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    Quote Originally Posted by jaybinder
    Here is something you might want to think about.

    Pacific Cycles and Performance Bike Shop have a very strong relationship. Margins on Cannondales (as with all bikes) are very thin. What will happen once Performance starts flexing its muscle? Prices will go down, but at whose expence? Your local C'dale dealer should be worried if they have a Performance near by.
    Just my 2 cents.
    At some point these buyout threads are going to have to die.
    We know only this : Dorel bought Cdale. Thats about it.
    The rest is becoming rampant speculation or even trolling....
    I think this thread should sink till something new develops........................

  96. #96
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    Quote Originally Posted by mickeydesadist
    remember, we as Canadians and Americans have heat in the winter, air conditioning in the summer and wages that can afford us usable cars and great hobby bikes. most of the people in manufacturing in the countries where our manufacturing is outsourced to may not. not only is labour underpaid but also safety is lax and human rights are questionable as is free speech. these are issues accepted and lived with.
    i love my prophet and will continue to buy if it remains made in USA. i will not if manufacturing moves to a country where i would not feel safe, comfortable, and free in.
    Price and profit through oppressive dealing is not what America and Canada or any empathetic and fair thinkers have built our countries on
    Thank you!
    Finally someone that shares my opinion.
    I don't think it's a quality issue if a frame is made in China....
    What you mentioned is EXACTLY what I also had stated before in some other thread.
    Therefore just like you I will NOT support a company that will outsource their products to China to make more profit and support a Communist, Human Rights violating Country!!!
    "Common sense isn't always that common!"
    Custom Prophet and Custom Delta V

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    What going to happen

    Ok here is the quick things that will happen:

    Under the Cannondale Sports Group:
    1. Cannondale-designed in PA
    2. GT Bikes-designed in Lakeforest, CA
    3. Schwinn Select-IBD bikes-designed in Madison, WI
    4. Mongoose Pro-IBD bikes-designed in Madison, WI

    Under Pacifc Cycle Group
    1. Pacific
    2. Dyno
    3. Mongoose
    4. Schwinn
    5. Roadmaster
    6. Instep
    7. Murray
    8. Schwinn Motor Scooter
    9. Plus many other Pacific brands

    The big changes could be that Cannondale could be sold at Performance Bike Shop. PBS is Dorel number one IBD customer. We could also see some Schwinn, GT, and Mongoose parts for sale in Bike shops. Cannondale could also close the US factory one day. Dorel is one of the top importers in the US. They are FedEx number one shipper.

  98. #98
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    Quote Originally Posted by CdaleTony
    At some point these buyout threads are going to have to die.
    We know only this : Dorel bought Cdale. Thats about it.
    The rest is becoming rampant speculation or even trolling....
    I think this thread should sink till something new develops........................
    It seems that you consider your job as moderator to be about stifling legitimate discussions that for some reason bother you or can be construed as painting the brand that you identify so much with, Cannondale, in some kind of bad light.

    Your heavy-handed behavior does not reflect well on you.

    What forums rules are being broken in this thread?

  99. #99
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    Quote Originally Posted by Ray Lee
    Just an FYI not everything they made broke, we have 3 that are all working perfectly.

    Guess I am just lucky
    No you're not lucky. The last time that guy owned a Cannondale was in the 80's ...

  100. #100
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    I'm going to draw a line in the sand....

    If Dorel crosses that line, I will no longer deal with Cannondale.

    If the outcome is they get more money, more resources... Continue to run as they have... Then I'll be happy...

    But, if they shut down the factory & move production to Taiwan ... Then I will curse Dorel to a hellish fiery death.

    By the way Matt Mannelly is a c*nt...

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