Insolvency

On 6 March 2008 Thielert's financial statements for 2003, 2004 and 2005 were nullified by a Hamburg court, on the basis that the company had breached valuation provisions. As a result of these events the company's stock dropped to a record low of €0.36 from previous highs of €25.22 on the German stock market.^[8][9]

On 23 April 2008 it was announced that the company Board of Directors had dismissed "with cause" company founder Frank Thielert and also cancelled his employment contract, due to evidence found during a criminal investigation by the Hamburg Office of Criminal Investigation. The allegations included that false invoices had been written, which were used to boost accounts receivable and create the appearance of a better financial position for the company. The board also dismissed Chief Financial Officer Roswitha Grosser and sold off €24.4 million to cover immediate financial requirements.^[10][11][12]

In April 2008 a stockholder restructuring plan was put on hold and as a result on 24 April 2008 Thielert Aircraft Engines GmbH, responsible for all engine production, filed for insolvency at the Chemnitz County Court. As the situation deepened, the Thierlert board stated on 26 April 2008: "The going concern of Thielert Aircraft Engines GmbH can only be ensured permanently by restructuring activities with the support of investors, due to the fact that the Holding Thielert AG is not capable to do so anymore." The company announced that it would name a new executive board and an interim insolvency trustee.^{[6][12][13][14][15][16]}

In April 2008 Cessna suspended plans to sell a Diesel-equipped Cessna 172TD as a result of the insolvency.^[17]

On 1 May 2008 the board appointed a new CEO, lawyer Marcel Kleib and lawyer Achim Ahrendt of Hamburg was appointed to oversee the insolvency proceedings.^[17] On 5 May 2008 bankruptcy administrator attorney Bruno M. Kubler issued a letter to company customers indicating that the business would continue to operate producing engines and parts, meet existing orders, to preserve its capability to reorganize. On 14 May 2008 Thielert announced that it would no longer honor existing engine warranties for engines installed in Diamond Aircraft and also dramatically increased the price of parts. Owners who required warranty work were required to pay cash in advance for parts. This announcement caused an immediate negative reaction from Diamond DA42 owners and also from Diamond Aircraft.^[18][19]

On 18 June 2008 the company announced that it was resuming production of all its Diesel engine products, with a production target of 80 units per month. Thielert guaranteed the new engines against defective materials and labor, but parts prices remained at the previously announced high levels.^[20][21]

On 10 July 2008 Diamond Aircraft announced that it was dropping out of the bidding to purchase Thielert, citing that Thielert withheld key information "vital to the due diligence process", although Thielert disagreed. On Friday 11 July 2008, Thielert issued a press release stating: "the reasons Diamond is presenting for its non-participation are clearly pretext". Thielert implied that Diamond was not a serious prospective buyer and that "Diamond's actions clearly serve the purpose of derogating Thielert's reputation in the naive assumption to be able to subsequently purchase Thielert far under value."^[22]

As part of its insolvency, Thielert indicated that it would not honor warranties or inspect and replace life-limited parts as was the case when the engines were sold to customers. This change in policy has resulted in Thielert-powered aircraft being grounded or no longer economically viable to fly. In November 2008 Diamond Aircraft CEO Peter Maurer said the insolvency commissioner responsible for Thielert's restructuring has come to understand that the eventual sale of the company will depend on product support. This led to Thielert reducing the cost of parts and actively working on extending inspection and replacement requirements for gearbox clutches as well as other parts.^[23][24]

In January 2009, Bruno M. Kübler, Thielert's insolvency administrator announced that the company was, "in the black and working to capacity". On 6 April 2009 the company announced that insolvency administrator had "transferred the company's operative new business to a company that is unaffected by the insolvency proceedings". The new company, Centurion Engines, is responsible for worldwide sales of Centurion Diesel engines and spare parts.^[25][26]

At the end of November 2010 the company was making a profit and actively seeking new investors. Kübler indicated that major lending institutions have loosened credit enough that investment is more likely than it was in 2008 or 2009.^[5]

Frank Thielert was arrested and jailed in mid-June 2013 as a flight risk, by a German bankruptcy court judge.^[27] In 2016 Thielert was sentenced to four years in prison for fraud in misrepresenting the value and financial position of the company during attempts to find buyers and investors.^[28]

On 23 July 2013 the company was sold to Continental Motors, Inc. Continental is owned by AVIC International, which is, in turn, wholly owned by the Government of the People's Republic of China. Thielert was renamed Technify Motors GmbH. Continental uses Chinese investment to continue development of the company's products, with an emphasis on extending gearbox inspection periods initially.^[7][29]