© 2024, Roadracing World Publishing, Inc. By Michael Gougis.
By Michael Gougis
While the long-term outlook for KTM is generally positive, the company will not participate in Grand Prix-level motorcycle road racing in 2026, saving an estimated $47.8 million per year, according to a report from one of Austria’s most prominent national newspapers.
The report, published through Der Standard, claims that the company will withdraw until 2026 because it fears “significant public relations damage” if it withdraws early from Grand Prix racing.
KTM is undergoing a financial restructuring, layoffs, and a production halt after incurring at least $1.87 billion in debt as well as accumulating excessive unsold inventory. A report from the agency representing the company’s creditors says the company “plans” to withdraw from “MotoGP Moto2/Moto3” racing. The Der Standard report quotes an internal document prepared by the Boston Consulting Group for the restructuring administrator; that document outlines the timeline for the departure and the expected annual savings.
The company spent around $208 million on R&D in 2023, with total motorsports operations spending around $98. 8 million, a figure the restructuring manager called “exceptionally high”, according to the Der Standard report.
Withdrawing at the end of 2025 may require the company to negotiate an end to several contracts. KTM’s 2024 announcement of the signing of Maverick Vinales and Enea Bastianini to the Tech3 squad, which is slated to have full factory equipment in 2025, said the pair was signed as part of a “multi-year agreement.” Brad Binder’s contract runs through 2026, according to the KTM press center, and the contract Pedro Acosta signed with the company in 2024 also is a “multi-year” agreement, according to KTM’s announcement of the deal. And KTM has a contract with MotoGP series organizer Dorna to put bikes on the grid.
The expected expansion in the off-road market is expected to help KTM overcome its existing monetary problems, the report said. This market segment is expected to grow by 3. 5 per year in the near future, and KTM’s steady share in this market stands at between 40 and 60 percent, according to the report.
The next court hearing for KTM is set for January 24th.
What Is KTM?
The company at the center of the insolvency is KTM AG, according to a report issued by the agency representing creditors owed money. But it is part of a complex arrangement of companies and subsidiaries–the report says that KTM alone has more than 60 subsidiaries. A review of the company’s financial reports shows that most of these are distribution and supply entities that depend on KTM AG’s activities, and several of these are expected to go through insolvency proceedings as well.
KTM is one of the five operating divisions of Pierer Mobility AG. Under the KTM umbrella are Husqvarna, GASGAS and MV Agusta; KTM’s 51% stake in the Italian sports bike company is expected to be split as part of the restructuring. KTM also owns a stake in Chinese automaker CFMOTO and its electric vehicle sub-brand Zeeho.
Other departments of Pierer Mobility include the Husqvarna bicycle department, GASGAS and Felt; the design and R&D department, led through Kiska, KTM F
Pierer Bajaj AG is the majority shareholder of Pierer Mobility. The Bajaj Group is a huge Indian conglomerate with interests in motorcycles, automobiles, home appliances, lighting, iron and steel, insurance and finance, according to Wikipedia. The Bajaj family is valued at $23. 4 billion, according to Forbes.
Pierer Industrie AG is the majority owner of Pierer Bajaj. As of November, Pierer Industrie operated three major divisions, including Abatec, a technology/electronics company; Pierer Bajaj AG; and Pankl AG, which operates in the racing, automotive and aerospace industries.
KTM’s race plans for 2025:
KTM racing activities are divided into 4 main categories: road racing, motocross/supercross, enduro/off road and rally.
By 2025, the company plans to field six riders in the Motocross World Championship (MXGP) series on KTM 450 SX-F and 250 SX-F machines. In North America, KTM is expected to field four riders in the SuperMotocross (SMX) World Championship series, which includes Supercross and Motocross events starting in January of the summer.
In the Enduro/Off Road category, KTM is slated to field eight factory riders in a variety of North American series. In addition, the company will field at least two factory riders in Europe, where the company’s factory racing teams compete in more than 100 enduro races each year.
In the Rally segment, KTM plans to box with 4 drivers for the Dakar Rally.
In Grand Prix road racing, KTM has shelved its GASGAS and Husqvarna brands for 2025. The official provisional entry lists show two riders on the Red Bull KTM Ajo team and two on the CFMOTO Aspar team in Moto2; 16 riders on the company’s RC250GP machines in Moto3; and the two-rider factory Red Bull squad and the two-rider Tech3 team in MotoGP.
« Previous article | Next article »
[flipbook id=”9″]
A press release is not an article written by Roadracingworld. com staff. When an article is marked as a “press release,” it means that Roadracingworld. com is not to blame for its content and that Roadracingworld. com does not guarantee its accuracy. Not all press releases are published and Roadracingworld. com would possibly reject them if the content is too sales promotion geared with little to no price news or if the press release features apparent errors.