With Quality Issues And Massive Debt, Will Gibson Survive?

With Quality Issues And Massive Debt, Will Gibson Survive?

By Andrew Catania

It’s no secret that rock has been present strongly ever since its birth, but it is also no secret that electronic music has taken over the whole panorama, and even rock music can be created without having actual instruments playing, which leads us to the latest headlines on places like The Washington Post, which dedicated a very fatalist article to the decline of sales on Gibson and Fender electric guitars, only to say later in the writing that some people think it might just be an exaggeration and that we cannot be sure of anything nonetheless.

So, what should we believe? First, let’s head to the underlying facts. In the past ten years, sales for electric guitars have gone from 1.5 million to 1 million, Gibson’s revenue was down from $2.1 Billion to $1.7 Billion, The famed guitar maker had its rating lowered to Caa3, nine notches into junk territory, with a negative outlook, as maturity of $520 million in debt approach.  The privately-held company will need to refinance the debt before July 2018, or it faces a likely default.   Gibson also has had issues with employee turnover.  Especially in the Artist Relations Department.  Quality control issues such as warped necks and frets are uneven right out of the box.

Retailers are losing money, and people are looking to sell their guitars instead of getting new ones. The reason seems to be the increasing array of technology available to make music and also the taste of the young people nowadays. In fact, even when the customers do choose to buy a guitar, they prefer to buy an acoustic one over an electric one, something that would have been unthinkable a decade or two ago.

The current wave of music genres do leave rock with plenty of competition, but the most obvious aspect to look at is that there are no guitar icons to look up to or admire in the way the guitar gods from the eighties made them respect them. No Vinnie Moore’s, Chris Impellitteri’s, etc.  There are no musical martyrs leaving their nostalgia on the chords and making everyone feel related to them. It was that idolatry that led people to buy their guitars and strive to become like them. We don’t seem to have that nowadays. Instead, the youth wants to rap, make electronic music, or hit the mainstream with anything that works, regardless of the skill.

There is no consensus on whether it is the guitar armageddon or not; some say it is happening and that electronic music will take over guitars, and others just think it’s a big exaggeration and that wherever you put a guitar, it will sell because there will always be someone willing to play them. Besides, if guitars get out of the mainstream media, there will still be tons of kids eager to go the alternative way. If there’s something particular about these times, is that mainstream has become more a substantial part of a whole instead of the vast majority of a whole, and alternative lifestyles are just as popular now.

Also, it does not matter the chaos they want to make us believe we’re in, rock will never be dead, and as long as people are relishing the times of guitar gods and martyrs, guitars will be sold, and songs will be made. It matters little what kind of songs or what kind of guitars, something like that, so iconic, will never lose its shine, and numbers can’t say otherwise.  Will Gibson survive?

One Reply to “With Quality Issues And Massive Debt, Will Gibson Survive?”

  1. I believe Gibson will survive. Henry is very creative. Gibson are just like a lot of other US Corporations- they never tell you this but they are diversified. In addition, they have ” Rainy Day” money offshore – a lot of money.

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