Mordaunt-Short, Epos, Rogers to close UK manufacturing.
Domestic UK sales were doing pretty well up until the end of the summer, but worldwide financial uncertainties seem to have sapped consumer confidence right across the UK retail sector, while from a specialist hi-fi perspective the launch of two new rival digital TV services in the pre-Christmas run-in is a further unwelcome distraction.
The fallout has begun. Some companies are arranging financial re-engineering of one sort or another. More worrying is the news of some actual closures.
Although the Rogers brand remains fully operational in sales and distribution, the UK manufacturing facility in Mitcham, South London (purchased from Swisstone Electronics some time after Rogers' Chinese owners acquired the brandname) has been closed down. There's ample stock to satisfy immediate demand while alternative manufacturing arrangements are made, but it's an uncomfortable reminder that this is not the best time to be manufacturing in the UK, and that the actual place of manufacture is becoming increasingly irrelevant in the modern global economy.
The bigger shock came on November 18. The publicly traded TGI Group is one of Britain's biggest loudspeaker groups, encompassing the Tannoy, Goodmans Loudspeakers, Mordaunt-Short, and Epos brands. The Group's financial results for the half-year to September 30 included an exceptional charge of £1.5 million to cover the closure of the Mordaunt-Short division (which includes Epos).
Rumors that Mordaunt-Short was up for sale had circulated much earlier in 1998, and signs of problems had surfaced a couple of months earlier, when then Managing Director Steve Harris departed on the eve of the September '98 Heathrow Renaissance Show. Early November saw a number of staff layoffs, followed shortly after by the news of the intended closure.
The closedown is to proceed in an orderly fashion over the next few months while commitments to staff, suppliers, and customers are honored. Current Managing Director Tim Roberts commented: "We are continuing assembly of all our models until current demand is met, and raw materials are used. We anticipate that spares and servicing arrangements will be available into the foreseeable future."
That, of course, assumes that the closedown goes ahead. Writing obituaries just two days after the announcement would be premature. While it's hardly surprising that there's no news of any rescue bids yet, the rumor mill is going into overdrive, and there's some optimism that either or both of the affected brands can be saved.
Over more than 30 years, Mordaunt-Short has built a strong reputation for fine sound quality coupled with value for money, based on its own original technology and considerable customer loyalty. The more upmarket Epos has an even stronger reputation as a niche brand, with a special appeal to audiophiles the world over---the Epos ES12 loudspeaker was Stereophile's "Budget Component of 1997," for example. At the time of writing I already know that several interested parties are looking closely at the possibility of carrying on the Epos operation as an independent entity. Watch this space.