Deadly figures:
January 1983 losses = DM 2,354,000
March 1983 losses = DM 948,000.
Money was vaporizing at an alarming rate.
MAICO, BREAK-O; DESIGNED TO FAILMaico was still
reeling from the Corte & Cosso shock fiasco in the 1982 models,
and absolutely had to come out with a winner to erase the bad
memories of destroyed rear suspension systems.
The 1983 models were released to the dealers in November 1982,
and initially, the dealers were ecstatic. Here's what Wheelsmith had
to say: "You can tell all the workers at the factory that the
new Maicos are so good, we can't believe it. Yesterday, I got to
ride the new 490 for the first time. Words cannot describe the way I
feel about the bikes. I sold five bikes the first day I had them in
the shop. If this is any idea of things to come, this will be the
best year for Maico and Wheelsmith. Again, thanks to all the workers
for bringing to the USA the best bike in the world."
Greg at Wheelsmith surely looked back at this statement sadly a
short time later, as the grief started happening almost immediately.
About 430 rear wheel hubs that were installed on bikes, suddenly
started failing. Several concerned dealers had the faulty hubs
checked and found they were never heat-hardened.
Gear-boxes started exploding like popcorn. Same story. Improper
heat-treating. Receipts were found from the Mohr & Lopez company
(the contracted heat-treaters), which proved that the gears received
only one part of the heat-treating process, rather than two. And
guess where the orders came from for the change in heat-treating
procedures? Right from the Technical Director, Wilhelm Maisch, Jr.!
It was found out by accident, when a memo was discovered from a
tax consultant named Brosamle, written to the Maisch brothers,
telling them what was needed to force Maico into bankruptcy and how
to bid to take it over once the deed was done.
As part of the plan to destroy Maico, the brothers allegedly
started a campaign via their friends in the press, and an onslaught
of negative articles started appearing. Peter Maisch, the press
relations expert, was seen constantly hanging around the
Sudwest-Presse building in Tubingen right before the most
destructive article came out, and was later seen at the race track,
laughing and joking with the reporter who wrote the article.
Numerous articles appeared, and in every instance, the reporter
was a close acquaintance of Peter Maisch. The most damaging was a
malicious article that appeared in an English magazine, causing
sales in England to come to a virtual stand-still. The British
importer, Goss, pointed out that the article was
written by a journalist who was a close friend of Peter Maisch.
Maico desperately tried to borrow money to warranty all the
damaged bikes, but when the banks saw the stories in the press, they
slammed doors in the face of Otto Maisch. In desperation, Otto and
his daughters depleted their savings and tried to save the company,
but the internal sabotage had been done far too effectively. Several
riders in the US had been hurt because of the defective exploding
hubs and weakened transmissions.
The law suits started, and that was the beginning of the end. The
final nail in the coffin was hammered home, when an American racer,
David Dion Scott (Virginia) was paralyzed when his rear hub failed,
causing a brutal crash. His law suit not only put a virtual halt to
further importation of the bikes, but it had US dealers scared to
death of becoming involved in the litigation. Numerous bikes were
returned to the distributor, and others were dumped at a fraction of
their true value.
Otto Maisch made one last desperate appeal to the government
banks to help the company through the problem, but on May 10, 1983,
the District of Baden-Wurttemberg flatly refused to give the Maico
GmbH credit. The notorious publicity campaign had done its job; no
one would lend Maico a spare Mark.
On May 10, 1983, Maico GmbH declared bankruptcy.
Smelling blood, the Maisch brothers quickly formed a company, and
by pulling strings with the bankruptcy receiver, Dr. Grub, were able
to get control of the company for a mere DM 300,000 ... a bit more
than a hundred thousand dollars US.
For the price of a CNC machine, the Maisch Brothers now owned a
company with at least 7 to 8 million Marks worth of equipment,
machinery, inventory and buildings.
The three brothers had, at this point, fulfilled their goal of
owning the company and ousting Otto Maisch, and were able to get it
for a tiny fraction of its true worth.
THE AFTER-MATHAn internal memo we saw tended to
point out the sabotage theory in a rather intimidating fashion. In
the memo, Wilhelm Maisch, Jr., admitted that his department had used
the wrong material in the gear-boxes and that this material had been
improperly hardened. Since this was a primary responsibility of the
Technical Division, one can only raise an eyebrow in shock. Also,
this information could have only come from Wilhelm, as he was the
only one with the authority to make any changes in material
selection and heat-treating processes.
Driving the point home, Wilhelm drafted a rather smug letter to
Theo Holznienkemper (a former US Maico manager) on February 23,
1984, in which he said that it had always been his dream to take
over the Maico company, and now that dream had been realized.
Oddly enough, the Maico US headquarters in California and
Virginia were still owned by the Otto Maisch family, and the factory
still owed them all kinds of money from the hundreds of failed bike
warranty claims.
The Maisch brothers tried every trick in the books to get control
of the existing Maico distributing, but couldn't pull it off. The
lawyers from both families had a field day, trading a barrage of
claims, threats and counter-claims.
They were fighting over very little, as the dealer network had
obviously disintegrated, and the fact that the horribly flawed bikes
were the direct result of Wilhelm Maisch, Jr., did not sit well with
most. It's one thing to fire off a shot; it's another thing entirely
to shoot yourself in the foot in the process.
In desperation, the Maisch brothers, who were now properly
heat-treating hubs and gears, were desperately trying to sell bikes.
The European distributors were irritated beyond belief, and showed
little - if any - interest.
The only way the "new" factory could succeed would be
to recapture the massive American market, the one where the name
Maico had once been legendary.
A deal was worked out with Ted Lapadaikis, the force behind the
Hercules Distributing Company that handled Sachs and KTM in years
past. The "new" bike was called the M-Star, a truly dumb
sounding name.
The 250 was basically the 1983 Maico, with all the warts removed,
and a water-cooled barrel. The fins were gone, but the old drum
brakes were still used at both ends.
The M-Star 500 Supercross was exactly a 1983 Maico, fins and all.
A few low-quality decals were slapped on the tank to make it look
different. The "Supercross" name showed the complete lack
of familiarity with the American dirt bike market. Open class bikes
were not even raced in Supercross. And the fact that all the big
changes were given to the 250 instead of the 500, displayed an
almost complete ignorance of the track record of sales. The big
Maicos always outsold the 250s on at least a three-to-one basis,
often more.
With lackadaisical advertising, virtually no promotion, a feeble
racing effort fielded by a few local second-stringers, and a
near-hostile relationship with the motorcycle magazines, M-Star
faded from sight within a year. Few bemoaned the passing.
BRINGING THINGS CURRENTThe Maisch brothers soon
became history. Too many bad memories, too much of a bad track
record to overcome, and a general inability to function in a
business-like manner, had the doors of the factory closed, and the
government put it in receivership.
The take-over had now become a farce. And a sad one at that. Over
the next few years, a number of companies tried to revive interest
in the marque. There were enough parts left over to build some
bikes, and that truly amazing 490 engine retained enough power from
its glory days to make it fun to ride.
But nothing serious happened. Right now, another small concern is
bringing the Maico in to this country in limited numbers. Mostly,
though, it remains a curiosity, and is purchased by people who
fondly remember the days when Maico was the king.
What's left of the family (Otto Maisch died a few years ago), is
still trying to find some justice. A mass of evidence of the
deliberate sabotage in 1982/83 was found and taken from the
abandoned factory.
When they tried to bring this before the German courts in the
hope of recovering the factory and restoring Maico, they were met
with stony silence. No one wants to admit that they are wrong, least
of all, the legal system. Then there's the fear of admitting that
some German products were faulty, and this would hurt the image of
German exports world-wide.
What will happen?
We don't know. It would be fascinating to see the German judicial
system review the case, now that these heretofore unknown documents
have surfaced.
To those of us who used to dearly loved the fabulous old Maicos,
perhaps a simple case of justice properly served might be
satisfying.
Meanwhile, hang on to that grand old 1981 490. Someday, it'll be
a collectors prize!
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