A bit of difficulties I'd say and I wonder how it will effect the MX side.
KTM is a sports giant and one of the most renowned motorcycle manufacturers, but even its huge global presence doesn’t mean it’s exempt from financial crises and that’s exactly what’s happening, forcing the mighty Austrian company to restructure.
KTM is in an alarming financial situation, having suffered a massive loss of 2.5 billion euros. This unprecedented crisis raises serious questions about the future of the Austrian company, owned by the Pierer Mobility group.
Faced with this worrying scenario, KTM has embarked on a comprehensive restructuring process aimed at reducing costs and optimizing its operations. Among the most drastic measures are a significant reduction in motorcycle production, cuts in investments in motorcycle competitions and the possible elimination of the GasGas brand from its portfolio, as well as the hypothetical discontinuation of the Husqvarna brand.
Several factors have contributed to this critical situation, including high interest rates in the United States and a sharp drop in sales in European markets. In response, the Pierer Mobility group is reorienting its strategy towards the Asian market, where sales have shown greater resilience.
However, this shift in focus could have consequences for Western consumers, as it could result in less investment in the development of models traditionally popular in Europe and North America.
As far as competitions are concerned, KTM plans to drastically reduce its presence. The Austrian brand will be the only one to maintain a significant participation, relying on the support of its main sponsor, Red Bull.
This crisis at KTM reflects the challenges currently facing the motorcycle industry in an increasingly uncertain and competitive global economic context.
They were spending money like crazy, all these sub brands like Gasgas and Husky never really made a lot of sense. It had to come to an end some day.
Was bound to happen before long. These companies are in the habit of spending like mad trying to grow all the way to an economic downturn, which we're on the precipice of. Action sports companies are not alone in this habit, but it's a bummer to see them lose money and likely pull a bunch of sponsorship dollars out of the sport.
…bikes are not selling here in California.
High interest rates combined with high prices would be my guess as why new models are still sitting on the dealer floors.
For a young guy looking to buy a dirt bike, it’s getting really hard to justify spending or financing 12 grand when everything else costs so much just to live nowadays.
Also, Boomers are holding onto bikes longer - I don’t see a ton of 2025 KTM’s at the local tracks, also word about the stiffer frame has spooked a lot of potential buyers I think.
I’m sticking with my 24s for another year because the used bike market is stone cold…
all the money they spent for Moto3 Moto2 and MotoGP 🫣
The Shop
Free shipping: VITALMX
DeCal Works Huge Plastic Inventory of UFO and Polisport kits.
Luxon 4-Post Bar Mounts
$189.95 - $239.95
Nothing is selling. Most people are spending their disposable income on inflation. Californian's are struggling more than anyone. When you see bigger corporations struggling, you know what is coming. It's going to get worse before better.
Thank you covid, thank you free money, thank you socialism. Thanks Newscum.
This too shall pass
Here is 5 pages talking about the same thing.
https://www.vitalmx.com/forums/moto-related/ktm-husqvarna-gasgas-future…
Gas Gas Bye Bye
We commonly see this in post-boom periods. Our most recent industry boom was obviosly COVID. Like many other liesure activity based industries, there we some companies that expanded and spent large sums of money to capitalize on an inflated market. That's great, and hard to ignore if you are leading these companies. Marketing gets more money, R&D gets more money, your sales team grows, HR adds headcount and everyone is feasting on the influx of cash, However, you must avoid the lure of thinking that this boom will last forever. If you can keep in mind that your expansion is somewhat artificial, and is likely to settle back into a more normal state, you can keep from "over-investing".
There must be a balance between "tooling up" to meet a very enticing demand, and putting yourself in an unsustainable position. The motocross industry numbers were phenominal during this period based on most accounts. Companies with a long term view knew that they were seeing something temporary and would likely adjust back down, perhaps above previously sustained levels in some cases, but certainly below peak. Some market research, trend analysis and historical perspective was needed to keep from getting over-extended.
Publicly traded companies tend to be under more pressure to capitalize on climbing markets. Shareholders and board members want to see quarter-over-quarter growth, climbing revenues, profits and stock returns. It some cases it makes sense to spend crazy amounts of money to meet the new market demands knowing full well that a downturn will cause great pain. Laying off divisions, decreasing marketing spend and downsizing/closing facilities could very well be worth it in the end. You'll have hard times like this eventually, but it still may put you in a better mid-long term coroporate financial position than having done nothing at all to meet the windfall of increased demands.
The exact same thing is happening in the guitar market, which I see as pretty similar to the motoworld in some respects. I have no insight into what is happening at Pierer Mobility, but this post-boom contraction seemed very obvious. There will be whoops in the road, but they should be fine.
People aren’t buying bikes like they have been but let’s be honest the pierer mobility group made some decisions that, even at the time, seeemed like a bad business decision or at best an odd one.
My kids always wanted my Gas Gas to go bye bye.😄
Be honest.... it's the wife who wants it to go away.
You wrote this down yourself or is it copy paste? If so it's maybe smart to share the source.
How did Pierer lose 2.5 billion? Is it stock devaluation or what do you exactly try to explain?
You just had to have those CNC'd drawer liners and 6 air conditioned private cry rooms?.... didnt ya?
Im glad to hear this as I am tired of reckless companies being so SELFISH and totally blind to economic conditions. Now their ignorance is going to leave 1000's of riders and supporters stranded with no replacement parts, R/D, service centers...etc. They dont care though... they just walk next door now and grab a orange one... instead of a white or red one.
It's so sad. Do you think the other teams will learn from this and maybe not add $500 in custom graphic wraps to all the grills and powerwashers?
Of course they wont... because IMAGE is the ONLY thing that matters to these clowns. Maybe try focusing on the customers and not the "elite" team blowing the profits all year.
/rant
Yes, it’s market capitalization.
12 Grand is effing madness.
MX is dying a slow death here in SA due to the prices of bikes.
Sad, real sad.
As someone who regularly travels a largish area and is in all types of motorcycle dealerships I wouldn't say 'nothing is selling'. KTM and their brands just absolutely buried their dealers with bikes at the end of 22 and continues piling on the units all of 23 and into 24. Most of the other brands have had a more regular flow of product so I'm not seeing tons of leftovers with those brands. Streetbikes are still selling really well as well as side by sides. Sure there's a little bit of a slowdown but the vast majority of the 60ish dealers I go to say things are still moving overall pretty damn good. The sky isn't falling, KTM just screwed up big time and is paying the price.
Thought them having Husky was cool, then when they acquired GasGas I thought that that was a bit much. What if those 2 brands go away, now that $60 million down building down the rd from me in Murrieta houses only the Red Bull KTM team? Then I was reading that KTM was making smaller shops increase their space or they wouldn’t be a KTM dealer anymore. Kinda crazy
Pit Row
https://motorcyclesports.net/ktm-faces-serious-financial-crisis-and-res…
Yes, a couple of sites are running the same story. The stock ticker looks ugly. It tripled between the covid dip and Jan 2022 (or even March 2023) but is now below the level at the covid bottom (Mar-Apr 2020). Rough ride back down for shareholders. Anyone brave enough to buy the dip? 😝
I am pretty sure over the next few years every major manufacturer is going to be “finding efficiencies” and “streamlining” its cyclical and pretty normal for corporations to restructure based on the economy.
That’s not politically correct here 😎
Joey MX is broke and or is already sitting on an overpriced ride that has not been ridden. The turnout @ the track and races is shocking.
KTM rode the Big Kahuna until the end.Couple boys with new Hondas looked like they were having fun.
Whoops in the road, no need to worry then, Roger will call the AMA and get them removed.
Perfect time for suzuki to buy gas gas & just put some yellow plastics on💪
Numbers were BOOMING at crazy high un heard of rates when KTM/Hus/GAS dealers all had ample bikes to sell and the rest had no inventory to sell.
It was inevitable that numbers would take a massive turn after the Japanese brands finally had new product back in their dealers floors reducing KTM/Hus/GAS sales.
I wouldn’t exactly call that financial trouble after making HUGE profits.
Would it make sense to keep all brands but do something like KTM 4 stroke SX/mx, husky enduro, and gas gas 2stroke? Maybe make each brand more different.
I was looking at he number of bikes Gasgas sold in the US and was wondering how they could justify spending so much money on a full race team. I figured they must have been hoping it would do better. But when I was looking at the numbers I knew they had to be spending much more than they were making.
I really think they will end up being OK. And perhaps there is more to the giant loss than it looks like.
I'm wondering if perhaps Triumph and Ducati could see the writing on the wall with the KTM group. Seeing what they have been spending VS bike sales. And they saw a lot of bikes being sold , just not enough to justify the crazy spending. Enough that if KTM were to go away, there would be a big hole in the market to fill. So perhaps that is the reason Ducati and Triumph are getting into MX. They figure that KTM will be gone by the time they develop their bikes and they will hope to get some of the KTM guys that don't jump ship to a Japanese brand.
Or perhaps Chinese in a couple years. CF moto is being super aggressive with new stuff. And they have US based team designing and testing stuff for the US market. They brought out a new SXS that looks to be on par or better than the other Sport SXS's that cost 10K more. Segway also has some good ,aggressively priced performance SXS's that they give a lifetime powertrain warranty for the original owners. How wild is that?
That’s not certain
They can save some money by getting rid of the dozens of managers they have in their MXGP teams.
Post a reply to: Financial reports.