Pierer Mobility, the parent company of KTM, Husqvarna, GasGas, WP Suspension and 50.1% owner of MV Agusta, has issued a statement noting a decline in overall sales for 2024, with expectations that this poor performance will continue throughout the year.
After three years of “above average success“The company announced that the sales figures for motorcycles in the European and American markets”have slowed significantly“with total sales volumes expected to fall 10% to 15% below previous levels in the motorcycle and bicycle divisions.
In response to this news, Pierer has announced cuts to its workforce, stating: “With the growth in sales figures over the past ten years, the number of employees at the KTM AG motorcycle subsidiary has more than doubled. In view of the changing market situation and location, the number of employees has had to be adjusted. This staff reduction after years of increase is painful, but necessary to maintain and ensure the competitiveness of the production site.»
The company attributes these challenges to both high interest rates in the US and market volatility in Europe, including rapidly rising production costs. In addition, dealers are also facing difficulties in selling new units, piling up large amounts of capital in showrooms with excess inventory.
As a result, Pierer has indicated that it will support its distribution network by extending payment terms and increasing discounts, which will further impact overall profits.
Pierer Mobility to make changes and relocate production
In addition to the workforce reduction in Europe, the brand outlined plans to further migrate production out of Austria. Pierer already has an established partnership with Chinese brand CFMoto and Indian company Bajaj, and the news suggests that more of the brand’s motorcycles will be manufactured in China, India or other low-cost environments. The statement continues: “Due to the increasingly fragile supplier industry in Europe, the PIERER Mobility Group is using the favourable economic conditions in these regions (India and China) to secure its competitiveness. An efficient and high-quality supplier industry is being established there.»
Although the news appears negative for the brand’s motorcycle division, its board of directors has predicted that the aforementioned cost-saving measures will compensate to such an extent that a break-even or even profitable year could still be salvaged.
