Joe Montgomery: The picture says it all...
This premiere US bike company was started in the early 1970's by Joe Montgomery,
an adventurous sort who decided being an inventor would be better than working
for someone else.
His company's first product was a bike trailer called The Bugger, and in 1983
Cannondale produced its first bike, made of aluminum. A short time later it
introduced its first mtn bike model, and, always known for its innovation, today
manufactures and exports an impressive line that includes performance road, mtn,
cross, triathlon, recumbent, and on and on.
The company hit a patch of gravel recently, but Cannondale's Scott
Montgomery tells us that road rash is not fatal...
Daily Peloton: Scott, we have a lot of other things to talk about, but
first I would appreciate it if you could tell us what is currently happening
with Cannondale, since the announcement of the company’s reorganization.
Scott Montgomery: We are in the process of selling the motorsports
business to another party. We as the management team are now 110% focused on
returning the bicycle company to its roots of bicycles and clothing. It is
refreshing to spend all our time again on bicycles, which we still love, and we
still find there is much to innovate and improve. By the end of March we hope to
be out of Chapter 11 and should have strong financing to move forward as the
Cannondale company we have all known for so many years. We will have a new
majority shareholder but we think we will find a partner that can benefit all
DP: Action Magazine stated of your motorsports division ATV that “it
looks like Honda, Yamaha and Bombardier brought knives to a gun fight.” So you
guys were into some serious innovation in your motorsports division, just like
you have always been in your bike division, right? Innovation has always been a
hallmark in your company, all the way back to your father’s original product,
the bike trailer? Why was it called The Bugger, by the way?
SM: We are proud that we were able to innovate in powersports. We hope
that the new owner will continue with our many good innovations. I cannot
remember why we called it The Bugger, other than it was a trailer around the
backside so it kind of hung around but did not feel as hard to pull as a bunch
of heavy panniers on the bike itself.
DP: Your father, Cannondale President Joe Montgomery, recently stated,
“The motorsports division was threatening the bicycle division.” Can you tell us
what happened there? The motorsports division has been purchased separately, and
will be run by others?
SM: We succeeded in selling many motorsports machines, but we could
not get the volume to the level to make it profitable on a individual unit
basis. Therefore as we sold more, we lost more money. We think someone will buy
motorsports and with their additional funding or maybe industry expertise we
hope they can take the final steps to make it profitable. So our only choice was
to file to allow us to sell off the motorsports and reorganize our efforts
around our generally profitable bicycle business.
DP: Almost half of Cannondale’s bike business is done through foreign
subsidiaries, and these are unaffected by the reorganization. Where does the
Cannondale bike division stand now? Has the bike division been sold, or will it
be? Will the present Cannondale management here in the US continue to operate
the bicycle division? We’re gonna see you and the guys at Interbike and the
races, aren’t we?
SM: Yes, approximately 45% of our sales are outside the USA. Our
offices in Japan, Australia, and Europe did not have big losses from motorsports
so they were able to avoid the Chapter 11 filings.We are very interested in
staying with the company we have built from the beginning but the final details
of the structure will be worked out in the future. We have booked space for the
Interbike Trade show, and at Sea Otter so I hope we are not going anywhere.
DP: Your company and your business associates have been though a rough
time; any general comments you would like to make now that you couldn’t earlier
due to Securities and Exchange Commission rules?
SM: Well this is not a fun process, I would never wish it on anyone.
But we are still very lucky that so many people are supporting our
reorganization. I have spent most of the last two weeks visiting vendors,
dealers, magazine editors and talked to a number of consumers as well, and
everyone is genuinely anxious to help us get back on our feet. That has been
very helpful to all our company to know so many people care and want us to
DP: Since the only thing to do is to get back on the bike, so to
speak, what is the plan? What are the positives that will come from these recent
events? What words do you have for your customers?
SM: Yes, we are back in the saddle so to speak, and it feels pretty
good. I am doing a Duathlon this weekend with my wife in Phoenix at the old
Cactus Cup race and it is great to have the time to focus all of my efforts back
in the bike business. We certainly appreciate everyone who has called and
written emails and just generally been upbeat and supportive.
DP: You mentioned that you have some new things going - what does
Cannondale have up its sleeve?
SM: I am happy to report that our bike R&D department has remained
totally intact. We have a ton of outstanding innovations coming for the 2004
model year. We have had multiple meetings this week about introductions of our
2004 models, so while I am sorry I can not comment yet, trust that we are
burning the midnight oil and we think our 2004 bicycle and clothing lines will
be our best offerings ever.
I saw your whole bike line at Interbike, but what I remember most were those
awesome custom decal jobs on the CAAD7s, though I must say that the CAAD7, a 2.5
lb bike, is a marvel in itself. Who’s riding what this year?
SM: We have all our road teams riding CAAD7 this year. Thanks for the
kind words on this bike, it has been selling extremely well and has received
multiple awards as road bike of the year from magazines around the world, which
of course makes us feel very good.
DP: Tell us about your teams - there are a bunch of them!
SM: Saeco/Cannondale - We are very, very pleased with the 2003 Saeco/Cannondale
team. Of course 2002 was a disaster with the Simoni affair but that is behind
us. For 2003 we have already been invited to the Tour de France. Fabio Sacchi
was in the yellow jersey at the Tour Down Under. And of coure we are very
excited to have Ivan on board to give our old friend the Lion King a run for the
sprints in the Giro.
DP: Siemens Mobile Mtn Bike Team - This is a brand new team this year,
with no less than Raul Paulissen (2002 UCI CX Ranked #3), Cedric Garcia (UCI
Ranking 4X: 2;UCI Ranking DH: 3), Tinker Juarez (1st in five 24-hour races in
2002), Christophe Sauzer (UCI CX Ranked #7). Some of these riders come from the
former Volvo Cannondale team, the winningest mtn bike team in history. Where do
you see this team going this year - like, to the stars?
SM: We were very fortunate to find Siemens Mobile and they are being
very aggressive in the sport so it is fun to work with such a strong and
enthusiastic cycling partner. Yes, we have been fortunate to be able to work
with many of the stars from the Volvo/Cannondale team and with the addition of
Raul we hope to build on that racing legacy of the past. I was at Tinker’s house
last week for breakfast; he said, “We are going to keep Cannondale on top,” and
I never doubt the determination and heart of this great man.
DP: 7Up/Cannondale - NRC 7th placed John Lieswyn, Monahan,
Pineda…this is the team in which every rider has podiumed in an NRC event – what
can you tell us about 7Up this season? What feedback have you gotten so far from
the riders about the CAAD7s they are riding this year? And what’s your take on
the US peloton for 2003? Does it seem like there’s now a greater degree of
talent distribution across the teams? Any other thoughts?
SM: Well 2002 was a fantastic year for the 7Up team. They really
reminded the US racing squads that they were a force to be dealt with, so we
have high expectations for 2003 as well. Yes, they are eager to be riding CAAD7
this coming season which we hope we give them an added edge. I am very excited
about road racing in the USA. With the growing Sea Otter vision, the ProCycling
Tour and now the Tour of Georgia it is an exciting time that we hope will expand
the sport with greater exposure than ever before.
DP: SoBe/Cannondale - This is a huge mtn bike team with men and women.
Tell us about this team.
SM: The SoBe Team is also looking very strong for 2003. We have not
released the final squad as of yet but we know Aaron Chase, our trials and DH
racer is back, and we will outline the final team in the next week or two.
DP: T-Mobile/Cannondale – We met all these ladies at the T-Mobile
training camp, have interviewed some of them and every one of them visited our
New Year’s Day chat. Aside from each being totally delightful, we predict they
will be the “magenta wave” this year - the team is a powerhouse. What do you
SM: This team is on fire, what more could you ask for in a team?
Smart, beautiful, talented women, a title sponsor that is excited about helping
women’s sports reach parity with men’s sports; T-Mobile is focused on using this
team as an outreach to women in general. What better device than a mobile phone
to expand your freedom and sense of security? And finally, with USA Cycling’s
vision of winning medals in Athens in 2004, it is going to be an exciting year
to build this amazing group of athletes into a powerhouse team.
DP: Wheelworks/Cannondale – Give us a “top-secret” tidbit about what
is going on in this development team right now…
SM: They are riding this new frame that …sorry, that’s top secret! But
Chris Peck and Curt Davis of the Cannondale R&D department will always be on the
cutting edge as they ride for this regional powerhouse.
DP: Aren’t you/weren’t you also an accomplished rider? Don’t you ride
in a couple of different disciplines? What bikes do you ride? How many of your
employees ride? Do they take over the local roads at lunchtime? Are there
company competitions? Do they all ride Cannondales?
Georgie and Scott Montgomery at the Las Vegas Triathlon
In my dreams maybe. But I do my best and I am fortunate that my wife Georgie is
a good athlete and we really enjoy cycling time together, so cycling is part of
our personal time which is lucky.
I am riding a Jekyll with a Lefty, a CAAD7 road bike, and I usually throw a
leg over new designs though I trust our R&D and team riders with most of the
technical issues, as my skills are not to the level to push the envelope. I
would say 70% of our company rides, almost all exercise and we encourage that,
since we think healthy heads are more motivated. We ride Cannondales but we all
spend a bunch of time on competitors products as well so we can compare and
improve from what we learn.
DP: Any parting shots?
SM: Our life at Cannondale has been very exciting with lots of ups and
downs. Most people forget that life is not a perfect journey with only blue
skies ahead. We of course are disappointed at our imperfections, but we are a
strong and determined group. We greatly appreciate the wonderful support of so
many friends and customers. We know with their support we can emerge stronger
Thanks very much, Scott!
Photos courtesy of Cannondale, Scott Montgomery and Janna Trevisanut.