Recaro Files for Bankruptcy Four Years After Being Sold to Private Equity

Recaro, one of the oldest names in automotive seating, filed for bankruptcy in a German court on Monday. The firm employs 215 workers at its factory in Kirchheim unter Teck, Germany, and the filing caught staff by surprise, who weren’t even informed beforehand according to Autocar citing local reports.

While Recaro also builds seats for aircraft and—believe it or not—gaming, only the automotive division is insolvent, as it was sold to Johnson Controls in 2011. Johnson Controls morphed into Adient, which sold the company to Detroit-based Raven Acquisitions, a private investment firm, four years ago. The original Recaro company licenses its name to Recaro Automotive, and Recaro Automotive of Germany stated in a press release that its global subsidiaries are unaffected by this filing.

Germany’s IG Metall trade union pressed the firm’s management for more transparency and plans to meet with staff representatives in the coming days, according to Auto Bild. Recaro Automotive’s collapse would seem to have been a while coming, as the publication reported that “for years” employees waived pay to benefit the company’s “economic stabilization.”

Recaro’s history began in 1906 when the company was founded as Stuttgarter Carrosserie und Radfabrik, or Stuttgart Body and Wheel. The brand name Recaro and the subsequent switch to focus on seating occurred in 1963 after Porsche acquired the body portion of the business. Ever since, Recaro’s developed a reputation both in manufacturing aftermarket seats, for enthusiast and professional racing applications, as well as original equipment for automakers. Anyone who’s ever owned or driven a Fiesta ST with them knows that the Recaro seats were the ones to have.

This is all very fresh, so it remains to be seen how Recaro will go on in the automotive realm beyond this. The car seat division’s recent path of bouncing between various corporate entities before winding up at the inevitable, miserable conclusion of a private investment firm strikes a stark contrast to the rest of the group’s relative stability, continuing under the same leadership in Stuttgart. Whatever happens next, an enthusiast institution hangs in the balance.

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