Pierer Mobility, the parent company of KTM, GasGas and Husqvarna (and major partner with MV Agusta) is making some big cuts. This week, the company released a statement saying that it was going to be selling off to pedal-bike brands and also making significant cuts to its European workforce.
The bicycle brand R Raymon is going back into the hands of its founders, Felix and Susan Puello. FELT, another pedal bike brand, is going to be sold in early 2024 to a consortium that includes Florian Burguet (who was the leader at KTM Canada and also a Pierer board member). Instead of the pedal bike business, Pierer says it now wants to focus on its ebikes sold through Husqvarna and GasGas. Expect to see more on that in coming months.
The announcement about the jobs in Austria is a tough blow, with 300 positions eliminated there. Those jobs are moving overseas, says KTM, to its partners in Asia. Bajaj already makes a lot of bikes for KTM in India and CFMoto has been ramping up production in China. Now, production and other jobs will move to those plants.
Pierer Mobility says this move comes as management is concerned about the economic situation in Europe, and wants to take advantage of savings from working in Asia. The press release read “Among other things, this is intended to exploit cost advantages in these regions and accelerate development and industrialisation processes.”
Pierer Mobility also said it is working with dealers to help them navigate tricky situations caused by increasingly high interest rates, offering higher discounts and extending payment terms to cushion the financial blows. The company says it expects growth of 5-7 percent in 2023, and roughly the same sales for 2024, with more cuts to come next year. In other words, the changes aren’t over yet, but it does appear Pierer Mobility is willing to do what it takes to stay in business.
