It really comes to something when a brand as iconic as Gibson Guitars cant stay afloat!

PRICES HAVE BEEN WAY TOO HIGH FOR TOO LONG A TIME.

It may be a good thing.  They tried to diversify the Gibson brand into other products and borrowed a lot of money to do it.  Bad news for investors but it may get them focused back on making great guitars.

Rap has been the dominant music for young people for at least the past two decades - not Rock! All that is needed is a beat box - not a guitar! Sales have been declining despite overproduction! And Asian production at lower prices has undercut American companies for years. Why buy a high-priced US Gibson when an Asian-made Epiphone offers comparable quality at a fraction of the price!

Guitar-snobbery will not help Gibson survive!

Creative destruction of Capitalism!

The Age of the Guitar Hero is long past!

Calm down Roberjerman...lol
We got your message!

I certainly would have to disagree on the age of rock and the guitar hero being dead and past.
Any of the many who attended Rockville2018 can attest to that 

Gibson has been severely mismanaged for over a decade.  Bad business decisions after even worse business decisions can destroy a company.  Getting rid of your best guitar craftsmen, auto-tuning guitars, expansion into lifestyle electronics along with massive private equity debt are some of the actions that sank Gibson.  The bankruptcy is an attempt at reorganizing, but if it fails and Gibson truly dies it really isn't that bad.  The value of the old Kalamazoo instruments will surge which is a good thing for the musicians who own them.

Since they plan to "wind down" their consumer electronics groups, the bankruptcy bodes an ill wind for Esoteric.

American workers are OK .
American management is world's worse.

I would have to agree that both Gibson and Fender have been overpriced new compared to some of the competition.
I have tried many at various guitar shops and tbh not one have I wanted to take home.
My axes include Schecter, ESP, PRS and Ovation right now.

A great article on this subject came out a year ago in the Washington Post.

https://www.washingtonpost.com/graphics/2017/lifestyle/the-slow-secret-death-of-the-electric-guitar/...

The modern day guitar hero? Taylor Swift.

@roberjerman "Why buy a high-priced US Gibson when an Asian-made Epiphone offers comparable quality at a fraction of the price!"

You do know Epiphone is part of Gibson, yes?

The ability to play in the affordable space didn't save them from this.

Gibson also owns Esoteric, TEAC, Onkyo, Pioneer, Cerwin Vega, Stanton, and some others, which means our niche will see some impact from this

Maybe someone will buy those marques and do something functional with them. Whatever the heck functional means.

I didn't know that Gibson acquired Esoteric/Teac/ and Pioneer.  Hopefully, they will be absorbed by a real audio company.  It's just further evidence that Gibson management didn't have a clue.

@trelja Yes I know that Gibson and Epiphone are the same (US and Asia).I have a 2005 Gibson SG and an Epi Les Paul Special! The Epi LP is really nice, despite being made in Korea!

Then there are the Chibsons and Chinese D45s.

I have owned several Gibson's their QC has been not up to par for awhile . I could not believe even when spending $2k to gave orange peel in the clear  frets should be even and not .Telephone
Made overseas in many cases better finished. Very sad 
Taking pride in your work should be automatic. Just leaving on their past laurels,not Good. Fender I think was more up to standards.
PAUL Reed Smith.  Has really come on strong and build a very good product. The late great Tom Petty loved his Rickenbackers not as popular but very well made. There are several custom brands out 
There very good Earnie Ball ,Excellent built precision 
Very sad to hear about Gibson, the rock world is a whoes who 
Of Les Paul ,guitar players, or She's. Hopefully someone will bring back the Glory.

I believe it was mainly poor policy choices and some slipshod workmanship that felled this giant!
Hopefully yes somebody will seperate the guitars from the electronics and make a go of both business
But the QC will need to be upped considerably for me to ever consider a new Gibson.
I was in Guitar Center in Appleton, Wisconsin last night and thought would compare a couple of new les paul and sg to prs and schecter they had in.
So sad but the Gibsons just did not compare in build quality or playability.
Now obviously you can pay to have a Gibson set up better but like you say major fret work and neck work on a new $1600 guitar?
Not happening!

Not sure if you read the press release in Music Trades but here it is:
LOOMING MATURITIES on approximately $500 million in debt have forced Gibson Brands to file for chapter 11 bankruptcy protection on May 1. Under a proposed reorganization plan, the company will liquidate the consumer electronics business it acquired from Philips in June of 2014 and focus its resources on its musical instrument business, which includes the Gibson and Epiphone guitar brands, and the KRK and Stanton audio brands, according to documents filed in a Delaware court. Court filings indicate that 69% of the bond holders have agreed in principle to provide $135 million in debtor-in-possession financing to fund the continuing operation of the musical instrument business during the bankruptcy proceedings. The proposed reorganization plan wipes out the ownership stake of existing Gibson shareholders, including CEO Henry Juszkiewicz, who held a 36% stake, and President Dave Berryman, who held a 49% stake. However, Berryman will be retained for a one-year period at a salary of $3.35 million to aid in a management transition, and Juszkiewicz will receive $2.1 million to provide consulting services for a year. Juszkiewicz will also receive approximately $1.5 million in profits from the sale of shares in TEAC held by Gibson brands. Juszkiewicz and Berryman will each also receive warrants to purchase a 2.25% interest in the reorganized company over the next five years.
  Court filings indicate that Gibson's core musical instrument and pro audio businesses are financially viable unlike the struggling consumer electronics division, which operates under the Gibson Innovation banner. In the fourth quarter of 2017, the musical instrument business achieved earnings before interest, taxes, depreciation, and amortization (EBITDA) of $26 million on revenues of $71 million. By contrast, Gibson Innovations had negative EBITDA of $8 million on revenues of $95 million. Gibson guitar revenues for the 12 months ended January 31, 2018 were $122 million, a 10% increase over the $110 million for the same period a year ago.
  The financial woes of Gibson's consumer electronics business, which sells headphones, speakers, and a range of accessory products, became critical in early 2017. Due to a 25% drop in revenues, the company had its vendor credit lines trimmed by more than $100 million, significantly reducing its ability to secure inventory. Simultaneously, it lacked the cash to pay the steep costs associated with laying off legacy Philips employees in Asia, Europe, and Latin America. Brian Fox, a partner with the law firm Alvarez & Marshall, who serves as chief restructuring officer, explained, "The company was trapped in a vicious cycle where it lacked the liquidity to buy inventory and drive sales, while at the same time it lacked the liquidity to rationalize its workforce to match its diminished operations."
  As finances deteriorated during the course of 2017, Gibson retained investment banker Jefferies Group LLC to develop a reorganization plan. During the course of 2017, Jefferies contacted 57 entities, both financial and strategic, about participating in either a sale or recapitalization of the company. In a court filing, Fox explained, "Financiers who reviewed the company saw the Gibson brand as strong and a great opportunity in the m.i. business. But the challenges of the Gibson Innovation business were too great to commit to a refinancing of the entire company."
  Juskiewicz said of the bankruptcy proceedings, "Importantly, this process will be virtually invisible to customers, all of whom can continue to rely on Gibson to provide unparalleled products and customer service. Over the past 12 months, we have made substantial strides through an operational restructuring. We have sold non-core brands, increased earnings, and reduced working capital demands. The decision to re-focus on our core business, musical instruments, combined with the significant support from our noteholders, we believe will ensure the company's long-term stability and financial health."

BTW...I'm sure you all know that Gibson has the second largest holding in Onkyo?

So the future of Gibson/Epiphone guitars looks good.
Future of electronic goods which is our prime concern like Teac, Esoteric, Onkyo etc looks less rosy.

Did anyone read the article I linked? Seems like the really interesting part of this is cultural rather than economic. I find myself bemused and encouraged by the rising number of girls learning guitar because of Taylor Swift.

I wonder if Bezoz would have published the WP article if Gibson and Fender sold directly to amazon?

@jond "Did anyone read the article I linked?"

Yes, I read it when it came out last year.  Makes a lot of sense, as culture evolves, where people spend their time, focus, talents, and money shifts.

The consumer electronics elements of Gibson pulling the company downward likewise makes sense.  The shift from both Japan to China and to a different sort (web-centric) of product has turned the market on its head.  This seems like the same road as Oppo.

I remember when I worked as an R&D chemist / materials science engineer.  Obviously, I went about constantly seeking out and acquiring all manner of chemicals.  Initially, it came as a shock when I used to make inquiries, the questions centered around our anticipated needs, with the quantities they dealt in being things like rail cars.  For me, a kilogram, gallon, or bag would usually wind up something I'd soon need to dispose of, and oftentimes, the sample quantities they sent out for free were 100 pounds or a 55 gallon drum.

While we feel disappointed in Oppo getting out of the disc business, our sad reality remains minuscule number of high-end audio consumers cannot justify the R&D, tooling, production, transportation, and marketing / sales costs involved

My son works at a boutique guitar shop. Fender and Gibson make unreasonable demands for the number of guitars they (smaller shops) must stock. Also, the line extensions from these guys over the years have been crazy. I mean $24,000 For A 'Blackie' Replica, Cigarette Burns Included?  It's gotten more into marketing and accounting and less about the quality these guys use to turn out. My son tells me more players are starting to switch to smaller, true quality products at better prices. He sees so much of this because this shop has the best reputation for guitar repair. They fix a lot of stuff that Guitar Center screws up, 

@jond  Yes, Taylor Swift is almost singlehandedly responsible for keeping the acoustic guitar business still relevant to the under-18 crowd!

Gibson reminds me of Harley or Margaritaville or similar brands created by and marketed to the over 50-crowd. Shite's changing; music's changing, but they still cater to an image.

Bad ideas and bad management can sink any business...I used to like Saabs.