<PAGE>
 
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                                   FORM 10-Q
(Mark One)

[ x ]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
       EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 1997

                                      OR

 
[   ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
       EXCHANGE ACT OF 1934

For the transition period from  _______________ to _____________
 
                        Commission File Number  0-19540
 
                         GLOBAL MOTORSPORT GROUP, INC.
 -------------------------------------------------------------------------------
            (Exact name or registrant as specified in its charter)
 
            Delaware                                    94-171638
 -------------------------------------------------------------------------------
(State or other jurisdiction or                 IRS Employer Identification
 incorporation or organization)           
 
 16100 Jacqueline Court, Morgan Hill, California                95037
------------------------------------------------------------------------------- 
(Address of principal executive offices)                      (Zip code)
 
Registrant's telephone number including  area code    408-778-0500
                                                  -----------------------------

                                    CUSTOM CHROME, INC.
 -------------------------------------------------------------------------------
   Former name, former address and former fiscal year, if changed since last
                                    report.

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days.

Yes       X     .  No             .
     -----------       -----------

     Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.

                                                        Outstanding at
               Class                                   October 31, 1997
               -----                                  -----------------

          Common Stock, $.001 par value                   5,077,442

                                      -1-
<PAGE>
 
                         GLOBAL MOTORSPORT GROUP, INC.

                                   FORM 10-Q
               FOR THE THREE-MONTH PERIOD ENDED OCTOBER 31, 1997
<TABLE>
<CAPTION>
 
 
PART I.            FINANCIAL INFORMATION                                       PAGE NO.
-------            ---------------------                                       --------
<S>                <C>                                                      <C>
 
     Item 1.       Condensed Consolidated Financial Statements
 
                   Consolidated Balance Sheets at
                   October 31, 1997 and January 31, 1997                           3
 
                   Consolidated Statements of Operations for the three and
                   nine month periods ended October 31, 1997 and 1996              4
 
                   Consolidated Statements of Cash Flows for the
                   nine month periods ended October 31, 1997 and 1996              5
 
                   Note to Condensed Consolidated Financial Statements             6
 
     Item 2.       Management's Discussion and Analysis of Financial
                   Condition and Results of Operations                             7
 
PART II.           OTHER INFORMATION
 
     Item 6.       Exhibits and Reports on Form 8-K                               14
 
     Signature                                                                    15
 
     Exhibit 11    Statement Regarding Computation of Earnings Per Share          16
 
     Exhibit 27    Financial Data Schedule                                        17
</TABLE>

                                      -2-
<PAGE>
 
                         GLOBAL MOTORSPORT GROUP, INC.
                          CONSOLIDATED BALANCE SHEETS
                       (In thousands, except share data)
<TABLE>
<CAPTION>
 
                                                 October 31,   January 31,
                                                     1997         1997
                                                 ------------  -----------
                                                 (Unaudited)
<S>                                              <C>           <C>          
ASSETS
 
Current assets:
  Cash and cash equivalents....................     $  1,879       $    40  
  Accounts receivable, net.....................       13,148        11,349
  Merchandise inventories......................       58,785        49,522
  Deferred income taxes........................        1,334         1,334
  Prepaid income taxes.........................        2,378         2,378
  Deposits and prepaid expenses................        2,913         2,851
                                                    --------       -------
                                                      80,437        67,474
 
Property and equipment, net....................       18,223        15,802
Other assets...................................       35,339         8,221
                                                    --------       -------
 
                                                    $133,999       $91,497
                                                    ========       =======
LIABILITIES AND SHAREHOLDERS' EQUITY
 
Current liabilities:
  Current maturities of long-term debt and
   capital lease obligations...................     $  3,194       $ 3,293
  Bank borrowings..............................        4,014         4,878
  Accounts payable.............................        6,795         4,600
  Accrued expenses and other liabilities.......        3,694         1,912
                                                    --------       -------
                                                      17,697        14,683
 
Long-term debt and capital lease obligations...       53,394        16,154
Deferred income taxes..........................          817           817
 
Shareholders' equity:
  Common stock, $.001 par value: 20,000,000
   5,077,442 shares issued and outstanding as
   of October 31, 1997, and 5,290,189 issued
   and outstanding as of January 31, 1997......            6             5
  Additional paid-in capital...................       29,056        31,760
  Retained earnings............................       33,029        28,078
                                                    --------       -------
                                                      62,091        59,843
Commitments and contingencies
 
                                                    $133,999       $91,497
                                                    ========       =======
</TABLE>
See accompanying note to condensed consolidated financial statement.

                                      -3-
<PAGE>
 
                         GLOBAL MOTORSPORT GROUP, INC.
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                     (In thousands, except per share data)
                                  (Unaudited)
<TABLE>
<CAPTION>
 
 
                                        For the three months ended  For the nine months ended
                                                 October 31,                October 31,
                                             1997          1996          1997         1996
                                        --------------  ----------  --------------  ---------
<S>                                     <C>             <C>         <C>             <C>
 
Sales, net............................         $30,450     $26,193         $94,455    $87,177
Cost of sales.........................          19,498      15,739          59,334     51,507
                                               -------     -------         -------    -------
 Gross profit.........................          10,952      10,454          35,121     35,670
                                               -------     -------         -------    -------
 
Operating expenses:
 Selling, general and administrative..           9,643       7,003          24,162     20,803
 Product development..................             347         347           1,048      1,074
                                               -------     -------         -------    -------
                                                 9,990       7,350          25,210     21,877
                                               -------     -------         -------    -------
 
Operating income......................             962       3,104           9,911     13,793
 
Interest expense......................             814         519           1,687      1,551
                                               -------     -------         -------    -------
  Income before income taxes..........             148       2,585           8,224     12,242
 
Income taxes..........................              66       1,011           3,274      4,884
                                               -------     -------         -------    -------
 
  Net income..........................         $    82     $ 1,574         $ 4,950    $ 7,358
                                               =======     =======         =======    =======
 
  Net income per share................         $  0.02     $  0.30         $  0.93    $  1.38
                                               =======     =======         =======    =======
 
Weighted average shares outstanding...           5,234       5,310           5,322      5,341
                                               =======     =======         =======    =======
 
</TABLE>



     See accompanying note to condensed consolidated financial statements.

                                      -4-
<PAGE>
 
<TABLE>
<CAPTION>
                         GLOBAL MOTORSPORT GROUP, INC.
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (In thousands)
                                  (Unaudited)
 
                                                               For the nine months ended
                                                                       October 31,
                                                                    1997       1996
                                                                  --------   --------
<S>                                                               <C>        <C>
Cash flows from operating activities:
 Net income.....................................................  $  4,950   $  7,358
 Adjustments to reconcile net income to net cash provided
  (used) by operating activities:
   Depreciation and amortization................................     2,097      1,551
   Changes in items affecting operations:
    Accounts receivable.........................................     1,219     (1,878)
    Merchandise inventories.....................................       981      6,321
    Deposits & prepaid expenses.................................       181      1,261
    Accounts payable, accrued expenses & other liabilities......     3,806     (2,612)
                                                                  --------   --------
Net cash provided by operating activities.......................    13,234     12,001
                                                                  --------   --------
 
Cash flows from investing activities:
 Purchase of intangible assets in connection with acquisition...   (26,376)        --
 Purchase of equipment in connection with acquisition...........      (770)        --
 Purchase of net current assets in connection with acquisition..   (12,383)        --
 Acquisition costs..............................................    (1,966)        --
 Additions to property and equipment............................    (3,474)    (2,179)
                                                                  --------   --------
 Net cash used by investing activities..........................   (44,969)    (2,179)
                                                                  --------   --------
 
Cash flows from financing activities:
 Bank repayment, net............................................    (2,369)   (12,258)
 Financing (repayment) on capital lease obligations and
  long-term debt................................................    38,646       (173)
 Issuance of common stock.......................................       786      3,390
 Repurchase of common stock.....................................    (3,489)        --
                                                                  --------   --------
Net cash provided (used) by financing activities................    33,574     (9,041)
                                                                  --------   --------
Net change in cash and cash equivalents.........................     1,839        781
Cash and cash equivalents at beginning of period................        40        312
                                                                  --------   --------
Cash and cash equivalents at end of period......................  $  1,879   $  1,093
                                                                  ========   ========
 
Supplemental disclosures of cash paid during the period:
 
 Interest.......................................................  $  1,878   $  1,229
                                                                  ========   ========
 
 Income taxes...................................................  $  3,107   $  3,094
                                                                  ========   ========
 
</TABLE>
     See accompanying note to condensed consolidated financial statements.

                                      -5-
<PAGE>
 
        NOTE TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
        --------------------------------------------------------------

Note 1 - Basis of Presentation
------------------------------

        The accompanying unaudited interim condensed consolidated financial
statements have been prepared in conformity with generally accepted accounting
principles, consistent with those applied in and should be read in conjunction
with, the audited consolidated financial statements for the fiscal year ended
January 31, 1997 included in the Annual Report on Form 10-K filed by Global
Motorsport Group, Inc. (formerly Custom Chrome, Inc.) (the "Company") with the
Securities and Exchange Commission.

        The interim financial information is unaudited, but reflects all normal
recurring adjustments which are, in the opinion of management, necessary to
provide a fair statement of results for the interim periods presented. The
results for the interim periods are not necessarily indicative of results to be
expected for the fiscal year.

                                      -6-
<PAGE>
 
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

        This Quarterly Report on Form 10-Q contains forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Actual results
could differ materially from those projected in the forward-looking statements
as a result of the risk factors set forth below under "Factors That May Affect
Future Results."

RESULTS OF OPERATIONS

        Net sales increased 16.3% to $30,450,000 for the three months ended
October 31, 1997 when compared to the same period of last year. Net sales
increased 8.3% to $94,455,000 for the nine months ended October 31, 1997 from
$87,177,000 for the same period of the prior fiscal year. The growth in product
shipments in the current three month period was entirely due to the
consolidation of the operations of Chrome Specialties, Inc. (CSI) from September
16, 1997, the date of the acquisition. Sales growth in the nine month period was
the result of the consolidation of the operations of CSI and higher sales levels
to customers who initiated business with the Company last year, particularly in
the western region of the United States. Sales growth due to price increases was
not material. Sales growth in the Company's core operations was lower in the
current three month period primarily due to delays in the receipt of products
imported from the Far East (primarily Taiwan) as the result of compliance
deficiencies noted by the U.S. Customs Service regarding the Company's products,
which delayed the release to the Company's distribution centers. These delays
resulted in higher than anticipated back orders for products which were out of
stock. In addition, the Company's main service provider for shipments to
customers, United Parcel Service, experienced a 3 1/2 week labor stoppage in 
August by its ground delivery personnel, which significantly reduced sales and
increased shipping costs for the Company. Other factors in the nine month period
ended October 31, 1997 which resulted in lower sales growth than recent
experience were lower sales in export markets, primarily Germany, one less sales
day in the nine month period when compared to the same period of last year and
generally poor leisure motorcycling weather throughout the Eastern United States
and Europe in the Spring and early Summer of 1997.

        Management has taken steps to correct deficiencies in product labeling
and other areas regarding the lack of compliance with U.S. Customs Service
guidelines. In early December, these steps have improved the flow of imported
products to delays which are close to historical experience. Continued steps
will be taken in cooperation and consultation with the Customs Service and
outside experts to attempt to bring the Company's imports to a level of
compliance which will eliminate future delays.


        Gross profit increased 4.8% for the three months ended October 31, 1997
when compared to the same period of last year. Gross profit decreased 1.5% to
$35,121,000 from $35,670,000, for the nine months ended October 31, 1997. Gross
profit as a percentage of sales was 36.0% and 37.2%, respectively, in the three
and nine month periods ended October 31, 1997 compared with 39.9%, and 40.9%,
respectively, in the same periods of last year. The increase in gross profit in
the current three month period was entirely the result of the


                                      -7-
<PAGE>
 
consolidation of the operations of Chrome Specialties, Inc. from the date of the
acquisition The decrease in gross profit as a percentage of sales in the current
three month period when compared to last year was due to higher backorder rates
on foreign sourced and higher margin product, resulting from delays in customs
clearance. In addition, to the above mentioned customs clearance problems, gross
margin as a percentage of sales was lower in the current nine month period when
compared to last year as a result of sales discounts and sales price decreases
responding to price competition from smaller distributors and direct selling
manufacturers in non-proprietary product lines and a general shift in product
sales mix to lower margin domestically produced products away from higher margin
foreign produced products.

        Selling, general and administrative expenses increased 37.7% to
$9,643,000 and 16.1% to $24,162,000, respectively for the three and nine months
ended October 31, 1997. The increase in selling general and administrative costs
in the three month period ended October 31, 1997 when compared to last year was
the result of 1) the consolidation of operations of Chrome Specialties, Inc.
from September 16, 1997, 2) provisions for reorganization and redundancy costs
associated with the acquisition of CSI and other factors, including costs
associated with the closure of the Company's recently opened Dallas, Texas
distribution facility 3) higher distribution facility costs as the result of the
opening of new distribution facilities in Dallas, Texas and Jacksonville,
Florida and 4) higher compensation costs as a result of additional sales staff
required for the Company's expanded field sales representative program.

        In addition to the above items for the nine month period ended October
31, 1997 selling general and administrative costs were higher than the
comparable period last year due to higher legal costs incurred as the result of
litigation with the U.S. Internal Revenue Service. These costs as a percentage
of sales were 31.7% and 25.6% for the three and nine months ended October 31,
1997 compared to 26.7% and 23.9%, respectively for the same periods last year.

        Product development expenses were $347,000 and $1,048,000, respectively,
for the three and nine month periods ended October 31, 1997. These expenses as a
percentage of sales were 1.1% and 1.3% for the three and nine month periods
ended October 31, 1997, respectively, compared with 1.3% and 1.2%, respectively,
for the same periods of last year. Despite the lack of growth or modest
decreases in product development expenses the Company continues to be committed
to the introduction of new proprietary products.

        Interest expense increased $295,000 for the three month period ended
October 31, 1997 compared to the same period last year. Interest costs increased
8.8% to $1,678,000 in the nine months ended October 31, 1997. The higher
interest costs in the current three month period compared to last year resulted
from bank borrowings to complete the acquisition of Chrome Specialties, Inc. on
September 16, 1997. The higher interest costs in the nine month period ended
October 31, 1997 compared to last year resulted from the abovementioned
borrowings offset by lower working capital borrowings earlier in the year.

        The Company's effective consolidated income tax rate was 44.6% and
39.8%, respectively, for the three and nine months ended October 31, 1997 as
compared with 39.1%


                                      -8-
<PAGE>
 
and 39.9% in the same periods of the prior year. The higher effective income tax
rate in the current period resulted from the effect of higher foreign tax rates
and the overall low domestic profitability of the Company.

LIQUIDITY AND CAPITAL RESOURCES

        On December 19, 1994 the Company issued $15,000,000 in Senior Secured
Notes to a life insurance Company, which were repayable, as to principal, in
five annual payments In the years 1997 to 2001. The Notes carried an interest
rate of 8.01% and were secured by substantially all of the assets of the
Company. Proceeds from the issuance of the Notes were used to support the
Company's working capital requirements and other corporate purposes.

        Net cash provided by operating activities in the nine months ended
October 31, 1997, was $13,234,000 compared with $12,001,000 in the prior year.

        In the nine months ended October 31, 1997, the Company made capital
expenditures for equipment necessary for two new distribution centers and
tooling for new products. The Company also expended $3,489,000 for the
repurchase of common stock on the open market.

        On September 16, 1997 the Company completed the acquisition of
substantially all the assets and assumed certain liabilities of Chrome
Specialties, Inc. Chrome Specialties, Inc. is a privately held, independent,
wholesale distributor of aftermarket parts and accessories for Harley-Davidson
motorcycles which operates from its 100,000 sq. ft. warehouse and headquarters
in Fort Worth, Texas.

        In connection with the acquisition of Chrome Specialties, the Company
entered into a $73.5 million credit agreement which (i) provided funding for the
acquisition price for Chrome Specialties, Inc., (ii) provided funding to retire
the Senior Secured Notes described above and (iii) provided the Company
additional working capital borrowing ability. Borrowings under the new credit
facility bear interest at the London interbank Borrowing Rate plus 1:%. The rate
reduces as the Company reduces the initial debt level. In addition the Company
has fixed the rate for two-thirds of the borrowing by means of a swap
transaction. The financing agreement requires the Company to achieve or maintain
certain financial results or ratios, and restricts the Company's ability to pay
dividends, repurchase common stock, make further acquisitions and effect certain
other transaction without the bank's consent. While the Company is presently in
compliance with the financial ratios and covenants of the bank agreement, there
can be no assurance that it be able to maintain such compliance. Any failure to
comply with these or other requirements of the bank agreement could have a
material adverse effect on the Company's liquidity, business and results of
operations.

FACTORS THAT MAY AFFECT FUTURE RESULTS

DEPENDENCE ON, AND COMPETITION WITH, HARLEY-DAVIDSON

        The Company is the largest independent supplier of aftermarket parts and
accessories 

                                      -9-
<PAGE>
 
for Harley-Davidson motorcycles. The Company's past success has depended, and
the Company's future growth depends, in large part on the popularity of Harley-
Davidson motorcycles and the continued success of Harley-Davidson in maintaining
a significant market share for motorcycle sales and the number of units sold in
the super heavyweight class. In particular, the Company's continued growth in
earnings is in large part dependent upon continuing demand for Harley-Davidson
motorcycles and upon Harley-Davidson's ability to meet such demand. In recent
years, many other motorcycle manufacturers have experienced fluctuations in
market share and number of units sold. If the market for new Harley-Davidson
motorcycles were to decline or if the popularity of existing Harley-Davidson
were to decrease, the Company's business, including earnings, could be
materially adversely affected.

     The Company also competes with Harley-Davidson in the sale of parts and
accessories for both new and used Harley-Davidson motorcycles to Harley-
Davidson's franchised dealers, most of which are also customers of the Company.
Harley-Davidson has substantially greater financial, marketing, manufacturing
and technical resources than the Company.  There can be no assurance that the
Company will be able to compete effectively with Harley-Davidson in the future.

     From time to time, the Company and Harley-Davidson have had disputes
regarding alleged infringement of certain of each other's trademarks and
patents, and certain litigation related thereto was settled in 1990.  There can
be assurance that other disputes, including those which could lead to litigation
regarding trademarks, patents or other matters, will not occur in the future
between the Company and Harley-Davidson.

     In addition, it appears that the Company's stock price has in the past and
may in the future be affected by fluctuations in the price of Harley-Davidson's
stock.  Adverse results in any of Harley-Davidson's businesses, including its
non-motorcycle businesses, could adversely affect the price of Harley-Davidson's
stock, which could, in turn, adversely affect the Company's stock price.

COMPETITION

     The market for the Company's products is highly competitive.  Key
competitive factors in the parts and accessories aftermarket for Harley-Davidson
motorcycles include the ability to promptly fill orders from inventory, the
range of unique products offered and the speed and cost of product delivery.
The Company's competitors include independent distributors ranging in size from
small to large, and the proximity of any distributor to a particular dealer and
the availability of unique products is often a competitive advantage.
Accordingly, even small local distributors may be able to compete effectively
against the Company.  In addition, the Company competes with Harley-Davidson in
the sales of parts and accessories to Harley-Davidson franchised dealers.  There
can be no assurance that the Company will be able to compete successfully in the
future with small distributors or with Harley-Davidson.  See also "Business
Competition" above.

     In 1995, the Federal Trade Commission (the "FTC") voted to dissolve a 1954
consent decree against Harley-Davidson which, among other things, had prohibited
Harley-Davidson from imposing exclusive dealing requirements upon its dealers.
This consent decree was lifted pursuant to the FTC's "sunset" policy which
presumes that decrees which are more than 

                                      -10-
<PAGE>
 
20 years old should be eliminated. In response to extensive public comments to
the FTC urging that it keep this consent decree in force, Harley-Davidson
reported that it had no plans to change its dealer agreements in order to
require exclusive dealings. However, there can be no assurance that Harley-
Davidson will not impose such exclusive dealing requirements upon its dealers
who now purchase parts and accessories from Global Motorsport Group, Inc.; nor
can there be any assurance that, if Harley-Davidson decided to impose such
requirements upon its dealers, that a legal challenge to prevent such an action
would be successful. If Harley-Davidson is successful in imposing exclusive
dealing requirements on its dealers, it could have a material adverse effect on
the Company's business.

DEPENDENCE ON KEY PERSONNEL

     The Company's success depends, in part, upon the performance of the
Company's President and Chief Executive Officer, Joseph Piazza, and other key
executives, including James J. Kelly, Jr. (Executive Vice President, and Chief
Financial Officer), R. Steven Fisk (Senior Vice President, Purchasing,
Operations and Product Development), Daniel Stern (Senior Vice President, Sales
and Marketing) and Dennis B. Navarra (Vice President, Administration).  In
addition, the Company's success also depends in part on the continued
performance of certain other key employees.  Although incentives exist for these
individuals to remain with the Company, the loss of the services of any one of
them could have a material adverse effect on the business of the Company.

DEPENDENCE ON PRODUCT DELIVERY SERVICE PROVIDERS

     The Company's business primarily relies on its ability to deliver many
small dollar value orders to numerous customers on a daily basis.  The recent
labor strike by employees of United Parcel Services caused the volume of
shipments that the Company was able to make to decline significantly, and caused
the Company to experience higher than normal shipping expenses.  While the
strike has been settled, there can be no assurance that future disruption in 
the Company's ability to ship its products to customers could adversely affect
sales, and increase costs, either of which could have an adverse effect on the
Company's business and results of operations.

SEASONALITY AND WEATHER

     The Company's net sales for its last two quarters of any particular fiscal
year are generally lower than the net sales for the balance of the year.  This
decrease in net sales is due to a lower number of orders by dealers in
anticipation of, and during, the cold weather months, during which motorcycle
riding decreases relative to the warm weather months.   Any such decrease has a
significant impact on the Company's quarterly earnings during the last two
quarters of its fiscal year because certain operating expenses remain relatively
constant throughout the year.  The Company seeks to mitigate this seasonality
through various promotional efforts and incentives, but no assurance can be
given that such seasonality will not have a material adverse affect on the
Company's revenues and earnings during this period.  See "Management Discussion
and Analysis of Financial Condition and Results of Operations" below.   In
addition, the Company's operating results may be negatively affected 

                                      -11-
<PAGE>
 
by adverse weather conditions particularly in the summer months.


DEPENDENCE ON THIRD PARTY AND FOREIGN MANUFACTURING RELATIONSHIPS; TAIWANESE
POLITICAL VOLATILITY

     A significant portion of the Company's products are purchased from third
party manufacturers, often through independent trading companies.  Although the
Company believes it has close working relationships with its trading companies
and most of its suppliers, the Company does not have long-term arrangements with
these parties, and therefore, cannot be assured that products will be delivered
on a timely basis or on terms favorable to the Company in the future.  In
addition, any disruption in the Company's trading Company or manufacturing
relationships could result in supply delays.  Many of the Company's suppliers
are located in Asia, and, therefore, the Company is subject to certain risks
associated with dealing with foreign suppliers, including currency exchange
fluctuations, trade restrictions and changes in tariff and freight rates.
Moreover, many of the Company's suppliers are located in Taiwan and the
Company's relationships with such suppliers are subject to disruption in the
event of remaining volatility in, or a worsening of, Taiwan's political and
military relationship with the People's Republic of China.

MANAGEMENT OF GROWTH

     The Company's success will depend in part on its ability to manage growth,
both domestically and internationally.  Such growth will require the Company to
enhance its operational, management information and financial control systems.
In addition, continued growth will require the Company to increase the personnel
in its sales, marketing and customer support departments.  If the Company is
unable to successfully enhance its systems or to hire a sufficient number of
employees with the appropriate levels of experience in a timely manner, the
Company's business, financial condition and results of operations could be
materially and adversely affected.

INTERNATIONAL OPERATIONS

     In the fiscal years ended 1997, 1996 and 1995, international sales
accounted for 19%, 20% and 17%, respectively, of the Company's total net sales.
The Company expects that international sales will continue to represent a
significant portion of its net sales in the future.  The Company's results of
operations may be adversely affected by fluctuations in exchange rates,
difficulties in collecting accounts receivable, tariffs and difficulties in
obtaining export licenses.  Moreover, the Company's international sales may be
adversely affected by lower sales levels that typically occur during the summer
months in Europe and other parts of the world.  International sales and
operations are also subject to risks such as the imposition of governmental
controls, political instability, trade restrictions and changes in regulatory
requirements, difficulties in staffing and managing international operations,
generally longer payment cycles and potential insolvency of international
dealers.   There can be no assurance that these factors will not have a material
adverse effect on the Company's future international sales and, consequently, on
the Company's business, financial condition and results of operations.

                                      -12-
<PAGE>
 
COMPLIANCE WITH ENVIRONMENTAL LAWS

     Both federal and state authorities have various environmental control
requirements relating to air, water and noise pollution that effect the business
operations of the Company and Custom Chrome Manufacturing, Inc. (formerly Santee
Industries, which was acquired by the Company in 1990), which in the past
utilized a chrome-plating and polishing process.  The Company endeavors to
ensure that all its facilities comply with applicable environmental
requirements, there can be no assurance that its operations do not violate such
requirements or that any steps taken by the Company to remediate any former
noncompliance with such requirements would not have a material effect on the
Company's operations.

POTENTIAL FLUCTUATIONS IN QUARTERLY RESULTS

     The Company's quarterly operating results have in the past varied and may
in the future vary significantly depending on a number of factors, including the
level of competition; the size, timing, cancellation or rescheduling of
significant orders; product mix; market acceptance of new products; new product
announcements or introductions by the Company or its competitors; changes in
pricing by the Company or its competitors; the ability of the Company to
develop, introduce and market new products and product enhancements on a timely
basis; product manufacturing costs; supply constraints; levels of expenditures
on product development; changes in Company strategy; personnel changes; general
economic trends and other factors.   In particular, because sales of the
Company's nonproprietary products generally result in lower gross margins than
do sales of the Company's proprietary products, changes in the mix of products
sold in any quarter toward nonproprietary products will likely adversely affect
gross margins.  In addition, the Company has in the past offered, and may in the
future offer, sales price discounts and reductions to stimulate sales volume
growth.  Any such discounts and reductions could have a material effect on the
Company's operating results and financial condition on an annual or quarterly
basis.

     Sales for any future quarter are not predictable with any significant
degree of certainty.  The Company generally operates with limited order backlog
because its products typically are shipped shortly after orders are received
generally on the same day.  As a result, product sales in any quarter are
generally dependent on orders booked and shipped in that quarter.  The Company's
customers generally have the right to cancel order at any time and to return the
Company's products for a refund, and the cancellation of orders already placed
and the return of products could have an adverse effect on the Company's
operating results in any quarter.  As a result, if sales levels are below
expectations, net income may be disproportionately affected.  Due to all of the
foregoing factors, the Company believes that period-to-period comparisons of its
results of operations are not necessarily meaningful and should not be relied
upon as an indicator of future performance.  It is possible that in some future
quarter the Company's operating results may be below the expectations of the
public market analysts and investors.  In such event, the price of the Company's
Common Stock would likely be materially and adversely affected.

                                      -13-
<PAGE>
 
                         GLOBAL MOTORSPORT GROUP, INC.

PART II.       OTHER INFORMATION
--------       -----------------

 
     Item 6.  Exhibits and Reports on Form 8-K

              a.  Exhibits
 
                  Exhibit 11 - Statement Regarding Computation of Earnings Per
                               Share

                  Exhibit 27 - Financial Data Schedule

              b.  Reports on Form 8-K

                  A report on Form 8-K was filed with the Commission on
                  September 23, 1997 related to the acquisition of substantially
                  all of the assets and assumption of certain liabilities of
                  Chrome Specialties, Inc., a Texas corporation.

                                      -14-
<PAGE>
 
                                   SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.



                                         CUSTOM CHROME, INC.



Date:   December 15, 1997                /s/James J. Kelly, Jr.
       ----------------------------      ---------------------------------------
                                         James J. Kelly, Jr.
                                         Executive Vice President, Finance
                                         and Chief Financial Officer

                                         (Principal Financial and
                                         Accounting Officer)

                                      -15-