European Motor Market Unstable, KTM Parent, Husqvarna, And GasGas Employee Layoffs

KTM 690 SMC R. (Doc. KTM)

JAKARTA - Not only has the slowdown in the electric car market in several areas, but the two-wheeled market has been quite sluggish since early 2024. This has been experienced by Pierer Mobility Group (PMG), parent company from KTM, Husqvarna, and GasGas, as well as 50.1 percent owner of MV Agusta's shares, announced the termination of employment (PHK) for slowing sales.

The number of employees who have been laid off has not been specifically announced. This step was taken after PMG previously experienced a significant increase in the number of employees. "KTM has even doubled the number of its employees in the last ten years in line with the growth in sales figures," said PMG's official statement.

"The reduction of these personnel, after years of increasing the number of employees, is painful," the statement continued, quoted from Visordown, July 22.

"However, this is necessary to maintain and secure the competitiveness of our production site."

PMG blamed the slowdown in sales in 2024 on market instability in Europe and high interest rates in the United States. As a result, PMG reduced production volume at Austrian headquarters. Instead, they will further take advantage of industrial partnerships that have been developed in China (with CFMoto) and India (with Bajaj).

"Due to the increasingly fragile supply industry in Europe, Pierer Mobility Group is taking advantage of the lucrative economic conditions in the region to secure its competitiveness. An efficient and high-quality supplier industry is being built there," the PMG statement continued.

PMG estimates a sales drop of between 10-15 percent in the fiscal year of 2024. They added that cost-saving measures (by reducing employees and European production volume) are expected to allow them to break even or even generate profit before tax in 2024.

"The Executive Board assumes that the cost savings applied in the fiscal year will be able to offset the negative impact of the decline in sales in such a way that a balanced (profit before interest and tax) EBIT that is slightly positive can be generated," the statement reads.

In addition to layoffs in the motorcycle business, Pierer Mobility Group is also expected to reduce the scale of some of their motorcycle racing projects. Media reports from the unconfirmed Motocross World Championship (MXGP) show that Husqvarna, which is currently lowering one motorbike in the MXGP class for Mattia Guadagnini from Italy, will not be present at MXGP next year.