is KTM going to the gallows?

[p6x]

You may have heard about it, but KTM is in dire financial situation since the end of 2023;

Today the CEO of the company has released a statement about the company's future; the same causation model for the same consequences. During Covid, KTM ramped up production to meet the insatiable demand. They invested a lot of money to produce more, also detrimental to quality.

The extreme measures they have taken have seen a lot of cost cutting, including shuting down factories and transfering activity to countries with cheaper manpower.

Are they going to survive? CF Moto, where KTM does some of its manufacturing in China is coming strong in the European market. This is one of the downside of manufacturing in China. You have to share the technology with the local company.

 

Edited 7 hours ago by p6x

[audiomick]

I read on the german forum that they have filed for insolvency. That is no doubt what he meant with "legal restructing proceeding with self admistration". They've filed insolvency, but are not being put in the hands of an administrator to sort it out. I guess we'll see how they come out of it.

 

Incidentally, crappy video, and really bad suits.

Edited 2 hours ago by audiomick

[p6x]

23 minutes ago, audiomick said:

I read on the german forum that they have filed for insolvency. That is no doubt what he meant with "legal restructing proceeding with self admistration". They've filed insolvency, but are not being put in the hands of an administrator to sort it out. I guess we'll see how they come out of it.

 

Incidentally, crappy video, and really bad suits.

The situation seem to be serious... they are going to stop the complete production on January and February and furlough the employees.

I understand they are, they have taken steps to prevent Pieirer mobility to be run by an external administrator during the recovery. They have apparently refused financial help from Red Bull for the same reason.

They have also said that MotoGP would not be impacted, but I have a hard time believing that. KTM needs to start developing the next generation bike for 2027. Potentially, it is going to be a big financial effort because they need a new engine, and new chassis, and compose with the new aerodynamic rules. I don't know if this year's debacle had anything to do with the cost-cutting.

As for the video, it seems to be clear they improvised it without any help from the usual advice companies. It is aimed at reassuring people they can continue purchasing KTM motorcycles.

On some of the forums I follow, I read about several issues that should have been taken care under warranty, where warranty was denied. Obviously, Internet is not the most reliable source.

They have been in financial trouble since 2023 now, and it seems they have a lot of debt and creditors; hence the reason why they are trying to stop the vultures to break the company.