Change of CEO at Gibson a positive step for return to archtop building?

[ThatRhythmMan]

Most companies have marquee products. Sometimes they make very little money on them (or occasionally sell at a loss).

I drive a Miata for instance. Previously I had a BMW Z4 and Subaru WRX. None have been big sellers, but they certainly get attention both from the public and the car press. A guy walks in to look at a Z4 and ends up with a 5-series as the family sedan.

I can see a case for Gibson making a small number of collectible guitars like the L5. I can also see them making some 175s or other iconic archtops in somewhat higher numbers. (The 175s are not really that hard to make with modern production techniques.)

I heard from a "reputable source" about a year ago that this was in the medium-term plan. But I have no idea if it will come to fruition.

As far as MSRP, guitars historically have had some of the highest MSRP to street sales ratios of any product. However, in the last 5 years, certainly in the last 10 years, you could not get a coveted archtop much under MSRP, except for the rare special sales through large dealers (inventory closeout). When things get highly collectible, the asking price becomes the final price.

(Again re' cars--we were used to getting thousands off MSRP until recently. My last 2 cars were more or less MSRP. Some highly desirable vehicles even have dealer markups in the thousands.)

Gibson sells guitars that fit that definition now. They are done in the Murphy Lab and many sell for multiple times over their regular run counterparts. Witness how the 50k “Greeny” guitars were sold out immediately and they sold out the initial run of the 20k versions in a matter of a few days. Guitars like those are the attention grabbers. They have helped drive the sales of the 3.2k version and regular run standards.

They could make a run of L-5s and Super 400s, but they would only generate buzz in a small subset of guitar buyers and won’t drive sales of less expensive guitars, not in the current climate at least. People looking to buy an SG or Explorer couldn’t generally care less about Gibson making a top tier archtop.


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[m_d]

Sad but true SS! Except for the M. Campellone part! That is a very good thing, and we're lucky as hell. As Vinny says, Mark's guitars "..are like Gibson's on steroids".

I'm a Gibson fan boy too, but if they were still making archtops, and I were in need of something like a Gibson, personally I'd be heading to M. Campellone asap!

Vinny mentioned a four-year wait list ! It's a long time, but I'm still tempted. Yet wouldn't a four-year wait list would indicate there's demand for archtops. I waited a year for a guitar at Dupont. Slaman and others also have wait lists. So how is there not demand for archtops ?

[skiboyny]

Gibson has a much larger production capacity than Mr. Campellone. What are the particular reasons they wouldn't be able to make a profit building archtops ?

Campellone makes maybe 12 guitars a year. Gibson isn't interested tooling up to sell 12 archtops. They basically liquidated their 175s a few years ago because the dealers weren't buying them. Dead inventory. Most of us (if not all) are old enough to be pretty much out of touch on what music is actually selling these days. The hero's you lament over were gone in the sixties. The music has been on a downward slide since then. There will always be a small group of people that are archtop lovers, but Jazz would have to make a strong comeback to drive the sales that an American run industry would be looking for, and I just don't see that happening. It's a players music.

[TAA]

A side track but maybe related.

In 2009 I watched the western movie Quigley Down Under…..too many times, my wife tells me. I convinced myself I had to have a rifle like the one in the movie. (I shoot guns in competition.) It’ a Sharps Model 74.

There are two US makers of replicas. The most notable is Shilo Sharps. Looking into it, there was a 2-3 year wait list there, driven mainly by the popularity of the 1990 movie. I eventually got one from their main competitor across the street, C Sharps Arms, a 4-month wait.

if it’s worth having, it’s worth waiting for.

Tom

[jazzkritter]

I am certain that if it was profitable for Gibson to make some sort of arch top they would have done it. Surely Montana has made some beautiful one-off archtops. So if they really wanted to, it could be done there I suppose. It what would the impact be on their core product lines?

But Nashville. As someone mentioned in another thread, the Nashville craftsman are not there anymore. Notice the complaints on LP forums of R9’s arriving with fret issues, finish issues, etc? Makes one wonder what the level of capability their current ‘craftsman’ have. Flexing workers that can’t spit out a decent R9 to start up an arch top line? Doubtful. The start up of a new archtop line will cost them dearly, and the ROI on a low sales guitar is not going to be pretty. (Look at all the effort ArchtopHeaven is putting into his startup. And that’s to support a small scale operation.)

I’ve often said before that I would predict, if anything, an extremely limited run with someone’s name on it, at their usual obscene collector-friendly price point.

But now I don’t know about that. Whose name will they use to sell arch tops? Wes, Herb, Scotty Moore etc… are there enough people outside this forum that have heard those names (much less the music) that are potential arch top buyers? Geez they dropped Larry Carlton even though they sell the heck out of ES335s. Maybe if they talk Slash into posing with a 175?

Again, if there were bucks in it, KKR would have told JC ‘build arch tops’. (Wouldn’t you love to know why KKR shut off JC’s oxygen. What little line in the devil’s bargain did he transgress???)

I wonder though if HenryJ would still be making archtops in this market? The core market is dying off. Ooops I’m one of those.

Oh. And I drive a Miata too. Nigh impossible to get an L5 case in the trunk. Had to take the inside trim panels out.

[Gitfiddler]

I read somewhere (JGF?) that Gibson had planned to reintroduce the ES175 back into production at some point in the future.

Has anyone read anything recently about that?

[bluenote61]

A side track but maybe related.

In 2009 I watched the western movie Quigley Down Under…..too many times, my wife tells me. I convinced myself I had to have a rifle like the one in the movie. (I shoot guns in competition.) It’ a Sharps Model 74.

There are two US makers of replicas. The most notable is Shilo Sharps. Looking into it, there was a 2-3 year wait list there, driven mainly by the popularity of the 1990 movie. I eventually got one from their main competitor across the street, C Sharps Arms, a 4-month wait.

if it’s worth having, it’s worth waiting for.

Tom

Maybe that was a side track, however a cold shower was runing over my back while reading this.
For me from old Europe I will never understand the mind set of comparing a talk about the waiting list for buying a guitar with the waiting list of purchasing a gun.
Never ever...

[jazzkritter]

Theres a poster on one of the Les Paul forums who seems quite legit and is a Gibson marketing planning type. Look up “Hey it's Mat from Gibson Product Development - AMA” on lespaulforum.com
He did state once they were looking at future archtop production, no mention of series, but indicated it would be limited runs.
There are over 70 pages now, i looked back about ten and only found LPLPLPs. YMMV, perhaps tou can have better luck searching for that discussion.

A production 175?

[tbeltrans]

Most companies have marquee products. Sometimes they make very little money on them (or occasionally sell at a loss).

I drive a Miata for instance. Previously I had a BMW Z4 and Subaru WRX. None have been big sellers, but they certainly get attention both from the public and the car press. A guy walks in to look at a Z4 and ends up with a 5-series as the family sedan.

I can see a case for Gibson making a small number of collectible guitars like the L5. I can also see them making some 175s or other iconic archtops in somewhat higher numbers. (The 175s are not really that hard to make with modern production techniques.)

I heard from a "reputable source" about a year ago that this was in the medium-term plan. But I have no idea if it will come to fruition.

As far as MSRP, guitars historically have had some of the highest MSRP to street sales ratios of any product. However, in the last 5 years, certainly in the last 10 years, you could not get a coveted archtop much under MSRP, except for the rare special sales through large dealers (inventory closeout). When things get highly collectible, the asking price becomes the final price.

(Again re' cars--we were used to getting thousands off MSRP until recently. My last 2 cars were more or less MSRP. Some highly desirable vehicles even have dealer markups in the thousands.)

Funny thing about cars and guitars...

The most I have ever paid for a car is $5k cash for my 2000 Toyota Echo that I bought used in 2004. I am still driving it today and it runs just fine. The most I have paid for a guitar was a bit more than 3x my Echo (again, cash) for my 1995 Citation not too long ago. Hopefully, I will still have it many years from now, though it probably won't matter since I am 70 now. If/when my car dies, I will probably just start taking the bus, since in my state, veterans with a serviced connected disability get to ride the bus and light rail for free. My guitar will never die.

Tony

[Jazzjourney4Eva]

As far as MSRP, guitars historically have had some of the highest MSRP to street sales ratios of any product. However, in the last 5 years, certainly in the last 10 years, you could not get a coveted archtop much under MSRP, except for the rare special sales through large dealers (inventory closeout). When things get highly collectible, the asking price becomes the final price.

Well, I did, and they were Gibsons. Vinny1K dd too, see above posts about his recent purchase(s). (Carved Gibson archtops aren't cars either, different market)

Being a loyal customer doesn't hurt, but I got deals before then too.

[Jazzjourney4Eva]

No offense to ES 175 lovers, but they're not L5s.

[Bluedawg]

No offense to ES 175 lovers, but they're not L5s.

I love them both ... and own examples of both.

They both have their own magic.



We'll see what happens with Gibson.

They have never made all that many L5s, Super 400s or other high-end archtop guitars. They have always been a niche, but up through the 1960s there seems to have been a stronger market for mid and low-end archtops that supported the making and marketing of Gibson's classic flagship archtop models.

The trend towards solid bodies may be finally knocking the archtops out of the Gibson line.

That said the market for small shop archtops seems to be stronger than ever ... with some builders pricing their guitars way beyond anything Gibson could get away with and people willing to wait several years to get them.

Maybe Gibson can process this information and the current archtop market and come back with a reasonable archtop bidness plan.

[Jazzjourney4Eva]

I love them both ... and own examples of both.

They both have their own magic.



We'll see what happens with Gibson.

They have never made all that many L5s, Super 400s or other high-end archtop guitars. They have always been a niche, but up through the 1960s there seems to have been a stronger market for mid and low-end archtops that supported the making and marketing of Gibson's classic flagship archtop models.

The trend towards solid bodies may be finally knocking the archtops out of the Gibson line.

That said the market for small shop archtops seems to be stronger than ever ... with some builders pricing their guitars way beyond anything Gibson could get away with and people willing to wait several years to get them.

Maybe Gibson can process this information and the current archtop market and come back with a reasonable archtop bidness plan.

Yeah, I don’t think it was solid bodies, they’ve been around. Even Clapton was lamenting the decline of the guitar and he wasn’t referring to L5s.

Henry was producing a healthy number of fine and fancy guitars, and the business was doing well. His other ventures messed things up, and then the bankruptcy and then Covid-19, and other economic changes.

Rest assured,, if smaller companies can make them and at premium prices, The Gibson Guitar Company could do likewise. Just have to have the right plan and execute it well.

[ARGewirtz]

Because Gibson is beholden to private equity, it’s difficult to know how Gibson has performed financially under Curleigh’s leadership but my guess is the answer is not good enough to suit the company’s private equity owners, so they gave him the boot.

Prior to becoming Gibson’s CEO, Curleigh was the CEO of Levi Strauss where his playbook was to try to reinvigorate an old, staid brand with some new energy and new products for a younger market. Clearly that was the idea when Gibson hired him. That was likely a losing strategy from the start; jeans and tee shirts can be promoted as lifestyle choices, not so much for a guitar when guitars are not the lifestyle accessory that they used to be when rock ‘n roll ruled the music world and before that jazz/R&B.

As for Cesar Gueikian, his roots are in private equity, first at UBS and then as the founder of Melody Capital Partners, which focused on private corporate financing and investing. So, the way I read the tea leaves is that they tried a marketing-first approach with Curleigh and that tanked so they reversed course and installed a private equity/financial management guy as CEO. That means cost cutting to generate not just profit but higher margins and business growth in the most underserved markets. So, I expect they will be reinventing their supply chain and promoting their most cost-effective products to the largest possible market; i.e., younger and global. If I’m right then I think it’s unlikely that the company will have much of an appetite to revive their archtop production line unless something changes to suggest that jazz boxes are an upcoming lifestyle choice for teens.

[tbeltrans]

This is apparently a custom ES-175 from 2010, a Chet Atkins model. Personally, I never cared for that heavy Bigsby piece hanging off a guitar. It reminds me of those big heavy bumpers on 50s American cars.

2010 Chet Atkins ES 175 (Custom Made) - musical instruments - by...

Tony

[Jazzjourney4Eva]

Because Gibson is beholden to private equity, it’s difficult to know how Gibson has performed financially under Curleigh’s leadership but my guess is the answer is not good enough to suit the company’s private equity owners, so they gave him the boot.

Prior to becoming Gibson’s CEO, Curleigh was the CEO of Levi Strauss where his playbook was to try to reinvigorate an old, staid brand with some new energy and new products for a younger market. Clearly that was the idea when Gibson hired him. That was likely a losing strategy from the start; jeans and tee shirts can be promoted as lifestyle choices, not so much for a guitar when guitars are not the lifestyle accessory that they used to be when rock ‘n roll ruled the music world and before that jazz/R&B.

As for Cesar Gueikian, his roots are in private equity, first at UBS and then as the founder of Melody Capital Partners, which focused on private corporate financing and investing. So, the way I read the tea leaves is that they tried a marketing-first approach with Curleigh and that tanked so they reversed course and installed a private equity/financial management guy as CEO. That means cost cutting to generate not just profit but higher margins and business growth in the most underserved markets. So, I expect they will be reinventing their supply chain and promoting their most cost-effective products to the largest possible market; i.e., younger and global. If I’m right then I think it’s unlikely that the company will have much of an appetite to revive their archtop production line unless something changes to suggest that jazz boxes are an upcoming lifestyle choice for teens.

So, do you think they’re in it for the long haul? Whew. If so, THIS group may have to file that one under “what the fudge was I thinkin’?”

It will be interesting to see what happens with this historic company. Would love to be a fly on the wall in that boardroom when they’re debating strategy.

[Stringswinger]

So, do you think they’re in it for the long haul? Whew. If so, THIS group may have to file that one under “what the fudge was I thinkin’?”

It will be interesting to see what happens with this historic company. Would love to be a fly on the wall in that boardroom when they’re debating strategy.

Equity bankers are only in things for a profit. For what was lent to Henry J., the profits from Gibson are not good (I believe that the capital they lent could have provided a much better return invested elsewhere than what they are now getting).. But having Gibson and getting some flow, it is better than a total loss or even a huge loss (which is what will happen if they sold the company right now). So they are probably in it for a long enough haul to either get the value of the company up and sell it and avoid a loss, or keep it long enough so that the cumulative cash flow they enjoy before they finally sell it will lessen the difference of their loans and what selling the company will bring.

Somehow, I think the major partners of KKR probably have the same kind of regrets about Gibson that Elon Musk has about Twitter. I don't care how rich you are, no self respecting businessman likes to lose money.

[Jazzjourney4Eva]

Yeah. In other words, this brand will have no mojo for some time. It’s already been years, so it’ll probably be years more.

Hello Benedetto.

[Christian Miller]

Because Gibson is beholden to private equity, it’s difficult to know how Gibson has performed financially under Curleigh’s leadership but my guess is the answer is not good enough to suit the company’s private equity owners, so they gave him the boot.

Prior to becoming Gibson’s CEO, Curleigh was the CEO of Levi Strauss where his playbook was to try to reinvigorate an old, staid brand with some new energy and new products for a younger market. Clearly that was the idea when Gibson hired him. That was likely a losing strategy from the start; jeans and tee shirts can be promoted as lifestyle choices, not so much for a guitar when guitars are not the lifestyle accessory that they used to be when rock ‘n roll ruled the music world and before that jazz/R&B.

As for Cesar Gueikian, his roots are in private equity, first at UBS and then as the founder of Melody Capital Partners, which focused on private corporate financing and investing. So, the way I read the tea leaves is that they tried a marketing-first approach with Curleigh and that tanked so they reversed course and installed a private equity/financial management guy as CEO. That means cost cutting to generate not just profit but higher margins and business growth in the most underserved markets. So, I expect they will be reinventing their supply chain and promoting their most cost-effective products to the largest possible market; i.e., younger and global. If I’m right then I think it’s unlikely that the company will have much of an appetite to revive their archtop production line unless something changes to suggest that jazz boxes are an upcoming lifestyle choice for teens.

I don’t doubt it - although it seems odd to me that one would choose to sell artfully reliced Les Paul’s and 335s in excess of 5K which it seems to me has been what the fuss has been about recently - that seems more a marketing strategy aimed at Boomer ‘Whales’ to me. But that do I know?

Anyway, this is why we can’t have nice things, apparently.

[Litterick]

As for Cesar Gueikian, his roots are in private equity, first at UBS and then as the founder of Melody Capital Partners, which focused on private corporate financing and investing. So, the way I read the tea leaves is that they tried a marketing-first approach with Curleigh and that tanked so they reversed course and installed a private equity/financial management guy as CEO. That means cost cutting to generate not just profit but higher margins and business growth in the most underserved markets. So, I expect they will be reinventing their supply chain and promoting their most cost-effective products to the largest possible market; i.e., younger and global. If I’m right then I think it’s unlikely that the company will have much of an appetite to revive their archtop production line unless something changes to suggest that jazz boxes are an upcoming lifestyle choice for teens.

What reason do we have to believe Gibson is not prospering? The board chairman says, "We are transitioning to new leadership at a time of strength to ensure the company continues its momentum," and I doubt he is lying. Gueikian joined the company at the same time as Curleigh, in 2018. He is a company man, who has taken over in the interim. He is also a guitarist. Curleigh's reasons for leaving are unknown to us.

I cannot see Gibson looking for a younger audience. Its products are aimed at boomers and millennials, trading on the company's past status in rock music. Curleigh revamped Kramer and acquired Mesa/Boogie: these lines are not toys for teens.

Gibson could trade on its more distant past, but the market for archtops seems to be diminishing. Luthiers meet the demand at the high end and Chinese factories make the rest.

[m_d]

I don’t doubt it - although it seems odd to me that one would choose to sell artfully reliced Les Paul’s and 335s in excess of 5K which it seems to me has been what the fuss has been about recently - that seems more a marketing strategy aimed at Boomer ‘Whales’ to me. But that do I know?

Anyway, this is why we can’t have nice things, apparently.

I agree, frankly. I'd like to seem them embracing a more expansive strategy rather than one based on "lifestyle" and declining demographics - which didn't prevent them from making mistakes in the past. Surely there's a future beyond that? What happened to optimism ?

[equenda]

I am convinced that the main reason Gibson no longer makes hollobody guitars is the amount of man-hours required to build such an instrument.
The profit margin for a solid-body guitar can be excellent but in the case of an Arched-top, it starts with a very high labor cost (many hours of work)....before the guitar is even put on sale.
The second reason is the difficulty of finding suitable woods.
A solid-body guitar can play well without using particularly expensive and beautiful woods.
Third reason: the chances that a hollowbody guitar, once painted and finished, will sound bad are quite high....wood is alive and can often play tricks on you. A solid-body guitar, if built well, is VERY likely to play well.
That's why the big companies now don't build high-end hollowbody guitars.

Ettore Quenda.it - Jazz Guitar - Chitarra Jazz

[frabarmus]

If Gibson stops making archtops, will Epiphone stop making them too as a consequence?
Anyway, the future looks brighter than ever for Ibanez...

[NSJ]

As I’ve mentioned before, my teacher was instrumental in helping the person who became his best friend, a man named Bill Schulz, buy Fender from CBS. Mr. Schultz ran Fender until his death from cancer in the 2000s. When he bought Fender, he was instrumental in rationalizing the production scheme, off shoring to places like Japan and Mexico. Leo ran Fender to the ground, at least CBS was able to pump some money into it. But, in the end, Fender was largely irrelevant to a big media company like CBS.

Under Mr. Schultz’s reign, he standardized the production process, so it didn’t really make a difference between a MIM or MIJ or USA brand Fender. The average time, from absolute start to absolute finish, of a factory made Fender plank or slab was 3.5 hours.

3.5 hours! Think about that number! Which luthier or company making archtops is gonna compete against that?

You can’t rationalize production much more than that. That’s just nuts.

[Herbie]

No wonder that CEO changes. Would You like to lead a company which made its biggest selling invention in 1959?