Schramberg – hGears manufactures high-precision gears and transmission components for e-bikes, electrified vehicles, and power tools. On September 7, the company’s German subsidiary filed for insolvency proceedings under self-administration with the Rottweil District Court. The move was prompted by illiquidity resulting from low production volumes and an excessive cost base. The plant is being particularly burdened by weak e-bike business, while existing production capacity is underutilized. A total of 181 employees are affected. However, production is continuing for the time being, though layoffs cannot be ruled out.
hGears Struggles with Declining Production Volumes
The financial difficulties extend beyond a short-term liquidity crunch. The company explicitly cites insufficient production volumes as the cause of its insolvency. At the same time, the cost structure is no longer aligned with current business volumes. Consequently, the company is pursuing self-administration to facilitate comprehensive restructuring.
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The weakness is particularly evident in the e-bike business. Group revenue in this segment fell by 31.2 percent to €5.1 million in the first half of 2026, down from €7.5 million in the same period the previous year. hGears attributed the decline to weak bicycle production and continued inventory reduction across the industry.
E-bike business slumps by more than 30 percent
Other business segments were only able to partially offset the decline. Group revenue fell by 5.6 percent to €46.8 million in the first half of the year. In contrast, the business involving components for electrified vehicles grew by seven percent to €25.5 million. Nevertheless, adjusted EBITDA remained low at €0.4 million.
hGears had already cut costs and adjusted its structures prior to filing for insolvency. Among other measures, the group reduced personnel expenses. However, these measures evidently proved insufficient for the German site. Furthermore, low capacity utilization is straining a production structure designed for higher volumes.
181 jobs depend on the restructuring plan
There is currently no binding job guarantee for employees. The restructuring plan is still being drafted, so the extent of potential workforce reductions remains uncertain. However, the company has not ruled out layoffs should adjustments to the cost structure prove necessary.
At the same time, the plant continues to operate and supply customers. The self-administration process is intended to facilitate restructuring while maintaining ongoing operations, allowing the existing management team to remain in charge. A court-appointed administrator is overseeing and monitoring the proceedings.
Insolvency Limited to Schramberg
The proceedings concern only hGears Schramberg GmbH. The parent company, hGears AG, and other group companies are not currently insolvent. Production sites in Italy and China also continue to operate. However, there may be financial repercussions for the publicly listed parent company.
A domination agreement exists between the AG and the Schramberg subsidiary; consequently, the group is assessing potential impacts on assets, financing, and earnings. For the Schramberg site, the success of the restructuring effort will depend primarily on future capacity utilization. If production volumes remain low in the long term, the site will need to significantly adjust its costs to match the reduced business volume.
Author: Blackout News
Sources: Outdoor Industry Compass (10.09.26) – Neue Rotweiler Zeitung (08.09.26)