KTM before the end: Financial crisis threatens thousands of jobs!

KTM before the end: Financial crisis threatens thousands of jobs!

The Austrian motorcycle manufacturer KTM is facing a dramatic turn: On November 29, 2024, the company at the Ried regional court submitted a self -government application for the restructuring of its debts of 2.9 billion euros. This phase of self -government enables KTM to develop a plan within 90 days in order to stabilize the financial situation without having to register immediately. Stefan Pierer, the managing director of KTM, explains that the brand is his life's work and he fights for their future. KTM has two main companies with different financial burdens: KTM AG has debt of 2.7 billion euros compared to around 1,600 creditors and around 2,380 affected employees, while KTM Research & Development GmbH and KTM Components GmbH have obligations of around 105 million euros that concern about 550 believers and 765 employees

as if the situation had not already offered enough challenges, bankruptcy is associated with a massive decline in the company's finances. According to information from Cycle News , the debt burden is due to aggressive expansion strategies that Pierer Industrie AG has implemented. These include the purchase of brands such as Husqvarna and Gasgas, which further worsened the financial situation of the company. According to the presentation, the current situation is the greatest bankruptcy in Austria for this year, with a forecast dismissal of around 500 employees until the end of the year. Production is scheduled to pause in January 2025, and from March the working hours will be reduced to a layer to reduce the enormous inventory that has reached record heights.

insights into the crisis

with a decline in the share price by 90 percent and a profit of 100 million euros in 2023, which corresponds to a decline of 281 million euros compared to the previous year, KTM is in a critical situation. The economic conditions after the Covid 19 pandemic have further complicated the situation because retailers were forced to significantly reduce prices. At the same time, the development of new models, such as the KTM 990 Duke R, in which the hype is Eclipsed through the financial crisis, is temporarily stopped. KTM will continue to remain active in MotoGP racing, but will stop all developments on the RC16 to save costs. Despite these adverse circumstances, the enthusiasm of the employees remains a decisive competitive advantage and the basis for a possible recovery of the company.