Under Armour Trying to Terminate 280 Million Dollar Deal With UCLA
UCLA football will be featured on the next season of the WALKING DEAD
That deal never really made sense. UA is struggling big time right now. About to lose Curry as their superstar as well.
That’s what happens when you have shit designers that can’t keep up with the big 2.
UA is trying to end the deal because of its own financial distress?
Wouldn't be a surprise. Lots of businesses are going to use Covid as an excuse for unpopular changes they would have made anyway.
I like their apparel, sans shoes. I wear more UA gear than Nike. The only Nike stuff I wear is shoes and Michigan apparel. Clothes fit better and last longer than Nike stuff.
UA clothing blow away the crap Nike puts out
While amused as a USC fan (as far as LA teams), the UCLA Football and Basketball programs are shells of their former selves (and with respect to Football that is not saying much). Horrible business decision by Under Armor...but that is on them, not UCLA.
UA had to back out of their decade-long MLB deal (two years before it even began) a couple years ago, too.
Shit designers? Design is fickle (Not That Fickell). Who knows what is going to be popular next year. Nike drives the process but isn't that mostly because they hit the mother lode in Michael Jordan? Isn't he the gift that keeps on giving? He's been retired for 17 years. He hasn't done much to stay in the limelight. He's an unsuccessful and very low profile NBA "Governor." But put his name on shoes and apparel and shzaam, they fly off the shelves.
So, in that environment, UA, the number three player in the market, writes a $280 million deal with UCLA? What sort of insanity is that? They have never been a power in football since the Terry Donahue era and that ended in 1995. And Basketball? With the exception of several years in the mid-aughts and a Natty blip in 1995, they haven't been anything since Wooden. And for this UA spends $280 mil???
Design is fickle, but, as your observation about Jordan indicates, cultural affiliation and cultural cache is a lot more durable. For better or worse, UA tends to get associated with guys who take goatee/sunglass selfies in their truck. Puts a pretty hard cap on their market reach, in a way that a smattering of sponsorships doesn't really help.
“UA tends to get associated with guys who take goatee/sunglass selfies in their truck.”
LOL I’ve never bought any UA stuff so I don’t know what you’re basing this on, but this type of selfie cracks me up.
While they will probably claim Force Majeure to get of the contract, this is all about the financials. UA had an operating loss of -$122M in Q1 on revenue of $930M. Operating cash flow was -$367M and FCF was -$398M. Massive understatement coming but that's a really shitty quarter and I'm sure Q2 will probably be worse. Nike just had a miserable quarter as well. UA is doing everything they can to preserve cash and getting out of this shitty deal with UCLA when no sports are being played is probably at the top of their priority list.
Chianti Dan strikes again!
It baffles me how much of a shit show UCLA is in football and basketball. They have a great campus, great academics, and are in a recruiting rich state and still can't hack it
UCLA's problems are AD/University leadership related.
Basketball was simply the EXTREMELY bad hire of Steve Alford after Ben Howland lost his fastball(AND pissed off the entire Southern California AAU circuit). Dan Guerrero simply hated the hiring and firing process and so went for an easy button push with Alford, which set the program back years. We'll see what happens with Cronin, but I have a feeling UCLA Basketball can get back to prominence pretty quickly.
Football is more complicated, they have an issue with USC being in the local area and having a LOCK on any top Southern California kid, which leads to them grabbing players who may be over-rated by virtue of being in a highly scouted area. They've also had terrible coaching hires because for years they hired on the cheap and the administration was actively hostile to the football program as they feel it conflicts with the image of a top academic university that they are building. It's also hard to get a great gameday atmosphere going as the rose Bowl(while wonderful) is NOWHERE NEAR campus. Not sure how the football problem gets solved for them as they went for the Chip Kelly hire and he seems intent on blowing the program up.
I'll be interested to see what happens with their new Athletic Director.
UCLA boosters wanted Urbz and were reportedly ready to pony up all the cash to make happen including buying out Chip Kelly. New university president said no thanks.
This is dead-on right. UCLA has a ton going for it generally. But the football atmosphere does suck, in part because the stadium, though wonderful, is like an hour from the campus. Ideally, USC and UCLA would together build a shared and centrally located stadium -- but that's probably a no-go given the private/public schism. The Coliseum is a dump.
The Coliseum is currently being renovated I believe. Might even be done, haven't checked in on it in a while.
My perception may be wrong (I don't live in SoCal) ... but I got the sense that over the last 20 years, USC has become "the people's school, the school the more working man SoCal resident gets behind", while UCLA has more of the snobby, elitist feel.
So USC has a lot more organic support behind it.
Now --- I may be wrong. And that may not exactly make sense either --- UCLA isn't the school with the moniker of "University of Spoiled Children." But that may be part of it.
Tuition at USC is $56k. There may be some Target Trojans out here, but my sense is that USC is as elitist as ever.
USC has always been the football school and UCLA the basketball school. And USC has had more recent success in football. There you have it. USC's campus location being right off of downtown LA while UCLA is squired away in Brentwood may have something to do with it as well.
UCLA is a public university that costs an instate resident $0/year to attend and USC is one of the most expensive private schools in the county where the Lori Laughlins of the world pretend their kids row to get them in. You have the dynamic totally reversed.
People with no attachment to either who rock USC gear do so because USC has recent national success and are probably more fun to cheer for, not because they are the school of the common man.
Tuition is $13k, but the majority of in-state students pay no tuition. Cost of attendance is $36k. The average in state student gets $17k to apply against that.
https://admission.universityofcalifornia.edu/tuition-financial-aid/
Good luck getting in to UCLA. My kid had a 4.2 GPA and 98th percentile ACT, as well as a varsity lacrosse starter and multiple ECs. Rejected flat out as an in stater, not even waitlisted. Accepted at Michigan OOS. You need a 4.4-4.5+ GPA and very high ACTs/SATs just to get in. Those are lower level Ivy League stats. Probably the most difficult public university to get in to.
UCLA should consider playing their games at the new Rams/Chargers SoFi Stadium. It's just 12 miles away from campus and there will be a ton to do around the area once fully built out. The Rose Bowl is brutal to get in and out of.
Yeah, UCLA is very tough to get into mostly because of the sheer number of applicants. They lead the nation in number of applicants per year. That mostly because it's one of the two flagship in-state public schools (along with Berkley), and also located where the majority of the CA population is and very appealing location for out of staters. USC has a lot of the same benefits, but too many in-staters are ruled out due to cost, whereas UCLA is a bargain for most college-bound high schoolers in CA.
Actually, your thesis is only half-correct. USC, since it's located in South-Central, has more urban appeal; it definitely draws a more diverse cross-section of fans. But the school at large is generally more snobby and Hollywood-centric than UCLA, which is a public school whose reputation isn't tied to football.
Yeah - I worded my post poorly. You did it a lot better than me - what I was attempting to get at.
nah, neither are really the "working man's" school anymore. Both are very difficult to get in these days, admissions fraud aside.
USC has always been the University of Spoiled Children, not sure how anyone would think it's for the working man.
Yeah your perception is essentially flip flopped... USC is definitely the elitist school. The working class people “get behind” USC because they’re historically a very good football program. But as far as the school itself... yeah USC would definitely be the elitist one of the two.
Pretty odd perception given that UCLA is a state school (an excellent one) and USC is kind of an uppity private school.
But USC does have OJ
deleted for redundancy.
They've been a mediocre program for 20 years now through 4 coaches. Maybe it's all the athletic administration running things, but that kind of turnover and continued mediocrity hints that there is something with the school itself that is more of a culprit.
Cal-Berkeley can say the exact same thing and they haven't won the conference in 60+ years.
My guess is UC governance isn't helping the cause, but regardless I think it's a lot more than just the athletic director.
When UA was coming up as a brand trying to compete with Nike and Adidas, they had a very well defined product portfolio of high quality merchandise. Unfortunately, as they got bigger and their portfolio expanded, quality slipped and there seems to be no clear direction as to the forward path of their brand. I think they've pivoted to substandard manufacturing practices and it really shows in their product offering. Their CEO Kevin Plank was ousted recently, who knows if the brand can be revived.
Was Plank also the founder? I could look it up, but you seem to know a lot on the topic.
Yes he was.
UA was most relevant (and competitive) in their early going when their focus and invention was largely the synthetic t-shirt-- the must wear item of any grade school to collegiate football player to wear under the shoulder pads. Hence the name "under armour". Once they began their march to become another Nike, ala footwear and every other element, along w/ sponsorships, it was clear they never had the leadership or design acumen to be anything other than the Walmart version. And being the Walmart version of anything can be precarious space for a brand, at best.
All I can say is thank goodness Michigan is again a Nike school. Although I'd personally like to see much more of the 1st rate "Nike" prototype product and less of the Air J. And would be even better if Nike would put into the Michigan offering some re-makes of vintage Nike, ala Blue Ribbon Sports archives.
first of all Guerrero hasn't been for the AD for several months. His leadership screwed the school. Second how does a school go from $1 million for meals to $5.6 million annually and still have a shit program.
WE MUST PROTECT THIS BALANCE SHEET!!!
Just start making UCLA apparel that says points out how much better USC is. It will sell, and they'll probably try getting rid of you at the same time.
How UCLA does do poorly compared to their neighbor points to a comedy of leadership.
UCLA is a top tier public academic institution (up there with U-M, UVA, GT). Their campus is nicer than SC and in a wayyyyy better neighborhood.
They have no one to blame but themselves.
So, I went looking for the firm answer as to why they’re going this route. Sounds like it’s strictly financial? Did UCLA do something that UA thinks they can terminate without penalty? There’s no doubt that it’s a worse deal for UA, but the amount of money, while a lot for any of us, isn’t going to save UA’s ass in any given year. Seems very strange.
1. It's currently the most expensive deal for college sports....and its for UCLA
2. UA pays that to the UCLA so that people can see the teams play in their stuff. And advertisements in stadiums, programs, sales booth in select areas, backdrops for press conferences, etc.
3. Nobody's out there playing
4. UA is probably having other COVID-19 challenges.
So, I'm sure there is something in there that if UCLA isn't fielding teams for whatever reason, they have some action they can take. If UA has buyer's remorse on the original deal, they'll try to use this as an out. If both parties were happy with the deal, they'd work this year amicably. If UCLA had remorse, they would tell UA to pay them for this year or "do what they have to do" to get out of the contract (I think this last one is currently unlikely).
Sure, $20M/year in expense a year isn't going to make/break UA, but their revenue challenges must be massive. And while $20M expense isn't going to save you, it is probably one of the larger, less impactful things to go after in order to get to that larger number you need to hit, there not just one singular thing you can do in these situations.
Don’t disagree with any of your points, and perhaps the symbolic nature of it also appeases some of their larger shareholders. Sort of like a “Hey everyone, we are doing all we can do!!” kind of thing. I get it. My issue with this, and with a lot of things done by publicly traded companies, is that it seems a lot more like trying to make it look good, verses actually making it good. Otherwise known as not addressing the root problem. Now that I read my comments, I may just be angry at the publicly traded company I work for.. lol
No doubt many lawyers are about to make a lot of money.
From what I've gathered reading here and elsewhere, UA might be struggling financially and is trying to shore up it's balance sheet, UCLA fans are unhappy with (surprise surprise) UA messing around with their color schemes, and there potentially being an attempt by UA to chase after the UFC contract with Reebok that is apparently ending this year.
This was always a crazy deal when UA made it so I'm not surprised they are suffering under having to over-pay a bit. UCLA is a global brand but it's not any more a cash cow than other top brands and all of those deals were more markedly less.
UA might threaten to file Chapter 11 which would probably let them walk on this deal
Interestingly, and of a more local interest for me, Temple and Under Armour have "mutually" parted ways after signing a 10 year deal in 2015 (which in the P5 economic world paid Temple about $3 million per season plus team uniforms etc.). It is the speculation of the Temple boards/insiders that UA is basically trying to cut costs. One might speculate what this would ultimately mean for major contracts for UA like Notre Dame or Auburn.
While the athletes at Temple have voiced happiness about the move to Nike as a Temple supporter/alum I have to admit some of their work on uniforms was really solid.
