Is Red Bull KTM in big trouble?

MxAddic
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11/29/2024 5:34pm
Zycki11 wrote:
I don't foresee a manufacturer buying them out.  If anyone will it will be a finance group looking to turn an unprofitable model into a profitable...

I don't foresee a manufacturer buying them out.  If anyone will it will be a finance group looking to turn an unprofitable model into a profitable model and then selling it. Just another example of growing too quickly and then a couple of bad years it wrecks you. 

So does hiding 2 Billion in debt.

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Zycki11
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11/29/2024 5:34pm
Zycki11 wrote:
I don't foresee a manufacturer buying them out.  If anyone will it will be a finance group looking to turn an unprofitable model into a profitable...

I don't foresee a manufacturer buying them out.  If anyone will it will be a finance group looking to turn an unprofitable model into a profitable model and then selling it. Just another example of growing too quickly and then a couple of bad years it wrecks you. 

MxAddic wrote:

So does hiding 2 Billion in debt.

ba dum tis

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Spoonguy
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11/29/2024 5:40pm

No way they survive, 3b in debt? If they sell 300,000 bikes a year (which I don't think they do) that is $10,000 debt per each bike sold. Who the fuck ran up this kind of debt, and what exactly for? The whole $60m headquarters in Kalifornia seems exceptionally stupid now, along with TBI electric start 125s, poor warranty service on street bikes, buying MV, buying bicycle brands, etc.. Nuts

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devotid
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11/29/2024 5:41pm

So the CNC'd drawer liners for every tool made and air conditioned 2k sq ft indoor mobile work shops were too far?

Who could have scene that coming?

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The Shop

11/29/2024 6:03pm
wr74 wrote:
Wow, almost 3bn debt, from what i have read today.  At low to mid 1's i thought there was a decent chance they survive, but 3bn...

Wow, almost 3bn debt, from what i have read today.  At low to mid 1's i thought there was a decent chance they survive, but 3bn is probably a bridge too far.  The only thing that KTM have going for them now, is that the problem is so big that their creditors (banks / Bondholders?  i'm not sure how its structured) now own the problem.  For them its a simple business decision, how do we best recover the most dollars and cents from this mess as we can.  These people do not care about motorcycles, so do not for one second think that "KTM can't fail, cos i went to the track today and Austrian bikes were everywhere".  If the creditors think they can get 45c in the dollar back by closing it down and selling off assets, versus 35c in the dollar maintaining it as a going concern, they will shut it down.  Saying that, i find it hard to believe their assets (factories / motorcycle design IP, and what else ?) are really worth anywhere near 3bn, but lets wait and see.  From the motorcycle world, it would probably be only one of the Japanese big 4 to have the financial swing to bail them out, and they will see more opportunity in letting KTM die than saving it.

Anton Wass will buy them!

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Team403
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11/29/2024 6:19pm

I know a lot of manufacturers have come and gone in the last 50 years - any this big?  Seems almost incomprehensible.   Damn they own the amateur mini bike scene - what would that look like if they went away - Cobra would be king for sure in the 50s.  Kawi and Yammy show above that 🤔

fins227
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11/29/2024 6:31pm

I’ll be shocked if they’re at A1 

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wvumounty
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11/29/2024 6:33pm

So the hospitality truck was a bad purchase?

IMG 7841.png?VersionId=bFwGhCDo.4nQD Ii
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Johnny Ringo
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11/29/2024 6:52pm

I like how you guys are picking apart a few million + dollar purchases here and there. you don’t rack up 2.9 billion in debt because you built a nice shop and aquired a tractor trailer. The fuck up is much larger than that. 

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11/29/2024 6:55pm
I like how you guys are picking apart a few million + dollar purchases here and there. you don’t rack up 2.9 billion in debt because...

I like how you guys are picking apart a few million + dollar purchases here and there. you don’t rack up 2.9 billion in debt because you built a nice shop and aquired a tractor trailer. The fuck up is much larger than that. 

I waiting for somebody to say they could have saved $2.9 billion by retiring DeCoster!

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wvumounty
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11/29/2024 6:57pm

It’s not like the 2+billion debt was racked up after the bad purchases. They were making bad decisions when they knew they already were in debt. Arrogance and greed.

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APLMAN99
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11/29/2024 6:58pm
Boomslang wrote:

The race teams will be fine...thanks to Redbull..

racerxx276 wrote:

Have you seen Red Bull's sale's this year?  Way way down...

Red Bull is a privately held company and doesn’t have to report financials, so I’m betting that you are pulling any inferred numbers out of your ass. 

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earlshive418
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11/29/2024 7:02pm

If I were Suzuki I’d buy Ktm. Bring back the 380 in an 08 rm chassis with brembo brakes. But if frogs had wings they’d get bird pussy I guess. 

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1
11/29/2024 7:08pm
If I were Suzuki I’d buy Ktm. Bring back the 380 in an 08 rm chassis with brembo brakes. But if frogs had wings they’d get...

If I were Suzuki I’d buy Ktm. Bring back the 380 in an 08 rm chassis with brembo brakes. But if frogs had wings they’d get bird pussy I guess. 

Who needs wings!

attachment-3828281776
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earlshive418
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11/29/2024 7:19pm
If I were Suzuki I’d buy Ktm. Bring back the 380 in an 08 rm chassis with brembo brakes. But if frogs had wings they’d get...

If I were Suzuki I’d buy Ktm. Bring back the 380 in an 08 rm chassis with brembo brakes. But if frogs had wings they’d get bird pussy I guess. 

Who needs wings!

Who needs wings!

attachment-3828281776

Almost spit my beer out😂

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APLMAN99
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11/29/2024 7:20pm

I still would love to see just how much in bonuses Pierer and the other major executives have paid themselves in bonuses over the last 18-24 months. Something tells me that at least a portion of the higher debt load could be because of something along those lines…….

Pierer can’t be a stupid guy. He had to know as well as anyone that the Covid ‘boom’ of sales was not going to last long term, but that he could leverage that increase to borrow more than he normally could. Then pay out the ‘extra’ cash in executive compensation so that when reality returns and insolvency occurs, there are some nice 10+ digit golden parachutes awaiting for a lucky few….!

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ns503
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11/29/2024 7:33pm

So I believe the answer is yes? 

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ratonmacias
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11/29/2024 8:03pm
Paul333 wrote:

Anybody else get the impression many people in the industry are enjoying KTM having to deal with this? 

 

Ktm fanboys can get intense. Werent they talking about buying Suzuki?

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S.A. Weave
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11/29/2024 8:51pm

Will the Bakers Factory survive?

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11/29/2024 8:59pm
If I were Suzuki I’d buy Ktm. Bring back the 380 in an 08 rm chassis with brembo brakes. But if frogs had wings they’d get...

If I were Suzuki I’d buy Ktm. Bring back the 380 in an 08 rm chassis with brembo brakes. But if frogs had wings they’d get bird pussy I guess. 

Who needs wings!

Who needs wings!

attachment-3828281776

Almost spit my beer out😂

Don't waste your beer!

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mxbmx
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11/29/2024 9:19pm
I like how you guys are picking apart a few million + dollar purchases here and there. you don’t rack up 2.9 billion in debt because...

I like how you guys are picking apart a few million + dollar purchases here and there. you don’t rack up 2.9 billion in debt because you built a nice shop and aquired a tractor trailer. The fuck up is much larger than that. 

I'm guessing they went all chips in to the MotoGP project. That couldn't have been cheap to start up something that big and keep up with the constant evolution/innovation 

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wrc777
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11/29/2024 9:56pm

Someone will buy the factory and ktm name at a price that makes business sense and continue production. Gasgas went out of business, but you can still buy the bikes Gasgas made with a different name. I would imagine the Gasgas and husky names are dead or won’t be updated ever. 

Rider salaries may go down a decent amount because of this. The group of guys in their early 30s (Anderson, Barcia, Stewart, maybe Roczen) will probably have to retire after this season. 

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earlshive418
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11/29/2024 10:32pm
Who needs wings!

Who needs wings!

attachment-3828281776

Almost spit my beer out😂

Don't waste your beer!

I know it’s not gonna happen but it’s a good dream lol

11/29/2024 11:36pm

3billion. Creditors are gonna lose a big chunk. of that. It's clearly possible to trade your way into that mess... but not out.

The brand and assets will be sold for whatever they can get. Get yer wallets out, you can soon buy a rotten orange for a few greenbacks.

There has to be more to this story, total lack of governance by the board and banks.

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Sandusky26
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11/30/2024 1:44am
Paul333 wrote:

Anybody else get the impression many people in the industry are enjoying KTM having to deal with this? 

 

Ktm fanboys can get intense. Werent they talking about buying Suzuki?

I remember being a Suzuki owner.

Karma is a bitch boys.

 

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Spoonguy
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11/30/2024 4:23am
I like how you guys are picking apart a few million + dollar purchases here and there. you don’t rack up 2.9 billion in debt because...

I like how you guys are picking apart a few million + dollar purchases here and there. you don’t rack up 2.9 billion in debt because you built a nice shop and aquired a tractor trailer. The fuck up is much larger than that. 

Nobody is saying that is the reason, they are pointing out examples of drunk sailor spending habits of this company. What you do with a dollar you do with a hundred, if you are willing to waste one million you are willing to waste a billion.

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TalinH112
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Belgrade, MT US
11/30/2024 5:22am
I like how you guys are picking apart a few million + dollar purchases here and there. you don’t rack up 2.9 billion in debt because...

I like how you guys are picking apart a few million + dollar purchases here and there. you don’t rack up 2.9 billion in debt because you built a nice shop and aquired a tractor trailer. The fuck up is much larger than that. 

It was the KTM napkins in the lunch room that did it!!!

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MxAddic
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11/30/2024 5:39am Edited Date/Time 11/30/2024 5:58am

Certainty one for the ages. I only have 2 questions. How was he able to hide that much debt and where did all the money go that was not on the books.

I suspect it had something to do with all the acquisitions that made no sense to us.

https://www.investopedia.com/terms/e/enron.asp

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Team403
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11/30/2024 6:02am
wrc777 wrote:
Someone will buy the factory and ktm name at a price that makes business sense and continue production. Gasgas went out of business, but you can...

Someone will buy the factory and ktm name at a price that makes business sense and continue production. Gasgas went out of business, but you can still buy the bikes Gasgas made with a different name. I would imagine the Gasgas and husky names are dead or won’t be updated ever. 

Rider salaries may go down a decent amount because of this. The group of guys in their early 30s (Anderson, Barcia, Stewart, maybe Roczen) will probably have to retire after this season. 

Yeah you’d be looking at about a 40% reduction in available factory SX rides.  Bidding for those places is going to def put downward pressure on COMP packages.  I’m guessing more private CR22 like teams would surface and as stated older guys retiring.

I am the most worried about the local dealers esp those not diversified with other brands.   
 

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