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K2 is moving to China !!!!

post #1 of 25
Thread Starter 
First Beijing gets the Olympics, Now this.
I am glad I have avioded there products for years due to poor performance, now I have a moral issue with them as well.

LOS ANGELES, July 19 (Reuters) - K2 Inc. [`KTO] said on
Thursday its second-quarter profits fell more than 64 percent
and announced a restructuring that would cut its work force by
about 15 percent and trim the ski maker's yearly profits
After moving some of its ski and all of its snowboarding
production to its plant in China in 1999 and 2000, Los
Angeles-based K2 said it will now close its Vashon Island,
Wash.-based manufacturing plant and move the rest of its ski
production facilities to China by the end of the third quarter.
In addition, the company was also closing three other
smaller plants in Minnesota and Alabama with most of the
production also moving overseas.
As a result, the company was eliminating about 450 jobs, or
about 15 percent of its work force, from those locations and
said it would take a pretax charge of between $10 million and
$11 million in the third quarter.
According to the most recent data from Hoover's corporate
profiles, K2 had about 2,900 employees in 2000.
"The ramping up of our China production is on target to
deliver strong second half margin enhancements as we deliver
most of our winter sports orders," K2 President and Chief
Executive Richard Rodstein said in a statement.
Still, he said as the economy continues to be sluggish the
outlook for some of its product categories remains uncertain.
"While we expect to have strong third quarter momentum,
fueled by our winter sports businesses, we anticipate the fourth
quarter to be impacted by continued softness in inline skate and
Kickboard sales and margins, partially offset by shipments of
Slip Fit skates," Rodstein said, referring to the company's new
Slip Fit "laceless" inline skates.
After restructuring charges, the company said it planned to
post a full-year profit of between 65 cents and 75 cents a
share, which is well below the $1.10 Wall Street analysts had
been expecting for the period, according to Thomson
Financial/First Call.
Based on the improved cost structure currently being
experienced in the China factory, K2 estimates about $7 million
in annualized pretax cost savings.

K2 said second-quarter income from continuing operations
fell to $2.3 million, 13 cents a share, from $6.4 million, or 36
cents a share a year ago. Sales for the quarter fell 10 percent
to $144.9 million from $161.9 million a year ago.
The company said the sales decline stemmed from a drop in
small-wheeled products, such as inline skates and scooters,
which offset increased sales in virtually all other major
sporting goods categories, the company said.
Worldwide winter sports products continued to gain momentum
particularly in the domestic market where preseason orders,
scheduled to be shipped primarily in the third quarter,
increased 20 percent over the prior year, K2 said.
"Second quarter sales and earnings declined as compared with
the prior year reflecting soft retail sales of inline skates and
scooters in the market," Rodstein said.
"As a result, K2 has taken dramatic steps to stimulate sales
of inline skates as we embark upon a new season," he said.
Shares of K2 closed at $11.80 on the New York Stock Exchange
on Wednesday, near the stock's 52-week high of $12.00 a share.
The stock's year low is $6.75.
((New York Equities Desk, (646) 223-6000))

Thu Jul 19 07:08:53 2001 -GMT- pnac (nN1953412) = 1 07:08
post #2 of 25
That sucks! I wonder where my 1999 K2 bike was made? I'll have to check. Of course, the frame is the only thing that's made by K2.
post #3 of 25
Jeez, maybe this thread should have been posted in the Technique and Instruction area, under the "Skier Retention...." thread. Since K2 is making it a little harder for several hundred workers to enjoy the hills...?
post #4 of 25
Hey John H, Howyadoin? Somehow or other I don`t even think your frame was made by K2,
probably Giant in Taiwan---check it out.
I could be wrong---the components are also imports--as on most bikes.
post #5 of 25
The only K2 product I've purchased since the delamination problems was a pair of used 88 Classics.

Now they don't have a prayer ...... Even Danny Quaile (sp. intentional) won't bail them outa this one.
post #6 of 25
I would like to order the Kung Pao GS's (hold the MSG), an order of the Chow Fen Si Slaloms and of course the Moo Goo Gai Mid-Fats... oh and a Bud. Thanks.
post #7 of 25
This is truly funny! The more things change, the more they remain the same! Decades ago people whinned about Japanese products being chintzy; now look what happened.

I never have had any K2 product delam. Could it possibly be the way some people treat them? Any ski will delam if you slam it hard enough. it's like the kid who drag races his Chevy on the street, breaks it and blames the car, and blames the tires for not lasting as long as he expected.

Can you really blame K2? Here's another example of Perot's giant sucking sound of companies moving overseas to save on labor costs. Let's see... who started GAF and NAFTA? Take a look at the other side- what would you do, faced with unions who have their workers who put bolt A into slot B all day long for $15 an hour, strike for more pay? You would look elsewhere for cheaper labor too!

I'm not praising or slamming K2's decision. I'm just looking at the facts.

Life's a pain... then you nap. Cat philosphy
post #8 of 25
I have never had a problem with any of my K2 equipment. (skiis, helmets, bumper stickers- heehee) I am sad to see them have to take this desicion as sort of a "last resort"-- I just hope thier quality doesn't decrease as thier profits may increase.

"When hell freezes over, I'll ski there too"
post #9 of 25
This sucks the big one... more jobs lost in Washington state...

AxisX made in China? I don't know...

I just don't know
post #10 of 25
If they adhere to product parameters (materials, assembly procedures, quality control, etc.) there should be no problems. My concern is this: whomever heads the factory over there should be watched. There have been times when overseas managers, to cut costs and make an extra buck for himself, uses inferior materials and shortcuts on procedures to do so. I truly hope this won't be the case. We shall see.

Life's a pain... then you nap. Cat philosphy
post #11 of 25
In south america, the chileans refer to K2 as KaKa Dos...hope they don't live up to that monicker!!
post #12 of 25
Er....... I think dos is ........ anyhoo duce in Chinese is pronounced "er".

BTW..... K2's rep for delamination dates back to the early 80's. And you didn't have to huck em and beat them...... they came apart quite nicely all by themselves.
post #13 of 25
post #14 of 25
Ohhh man. Now I'll have to join a new cult...K2 how could you do it?

Spank Me
post #15 of 25
Check out some of the posts under Ask K2
www.k2skis.com/k2cafe/maincafe/cgi-bin/Ultimate.cgi?action=intro <FONT size="1">

[This message has been edited by Cultvo (edited July 20, 2001).]</FONT>
post #16 of 25
Lets see, K2 moves head quarters from Vashon to L.A., then production to China. Boeing moves head quarters to Chicago... Dan Qualye is on board now, should grease the import rails. K2 has never produced a superior product, but they will produce a superior margin, if you continue to support them.
p.s. I have read many post stating to support your local ski shop , not internet sales, so they will be there to support you when you need them. How about supporting your local work force?
I own my own company, jyrddog and I start employees out at $12/hr. Look at Seattle living cost, not greater Portlands to determine how much it cost to live before putting nut A onto bolt B.<FONT size="1">

[This message has been edited by Sloppy (edited July 21, 2001).]</FONT>
post #17 of 25
Hey wait a cotton-pick'n-minute!!!

I just thought of something...


Wow, now I'm going to have to get one of those tree/Kashi/hugging/free/save/something bumper stickers.

Instead of "Free the Heel", lets "Free Tibet!"

I feel better already.

<FONT size="1">

[This message has been edited by Rock'n Doc (edited July 23, 2001).]</FONT>
post #18 of 25
I am depressed.

Do you think K2's product lines will extend into piezo-electric chopstics? or maybe Mod-tech rickshaws will be the order of the day... man this sucks!!

(Bummed out ex-K2 rep)
post #19 of 25
Just got my warrranty replacement Aixs X Pro's the other day. I thought it a bit ironic that they have "USA" printed across each sidewall in large letters. I also sighed to see perhaps the last "Made in the USA" K2 that I will ever own. :-(

So, if K2's delaminate, Salomons crack (Pro-links), Rossi's explode (at the sidewall)...I suppose that leaves us with Atomic, Dynastar, and Volkl. However, the way that the integrated binding is progressing, only Dynastar gives you a choice. This is beginning to blow!
post #20 of 25
That's too bad considering their line of skis was really good this year. They continue to have stupidity problems though. Why change the name of the ModX ? Do they think they'll sell more? It's a good name and now they've lost it. People have just figured it out and can recognize them. Has K2 heard of the XScream? Same color, same name for what? 3 years?
Then there's the graphics.... I thought they did pretty well with the MachS and MachG but that Axis, geez....A little too many doobies and "Yes" album covers over there...
post #21 of 25
What do you have against YES album covers?
post #22 of 25
Take your fingers out of your ears! 90125 was SWEET! That, along with Mr. Loaf and Alan Parsons Project, was the music I came of age to! How dare you desecrate the sanctity of YES! .... What was the question again?
post #23 of 25
You have to admit YES kind of Starhipped out in the later years.. or do you like Starship too?
post #24 of 25
Oh. Starship flagged a bit after they switched from "Airplane". Wasn't a huge fan. Unfortunate, really.
post #25 of 25
Re: K2 move to China and related discussion.

Did someone say boycott. If not here it is:

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