KTM’s dance with financial peril appears to be winding down after a simple majority of creditors (more than 50 percent of entities holding at least 50 percent of total claims) approved a restructuring plan presented by its parent company, Pierer Mobility. The plan involves a one-time cash payout equaling 30 percent of each approved creditor’s total claim, with the overall disbursement totaling €548 million to be deposited by May 23, 2025.

For the deal to hold, Pierer must raise €800 million in fresh capital, with the infusion expected from an extended group of supportive shareholders, including Bajaj Auto. And yes, a rumor was circulating last week that BMW was interested in investing in KTM, but that remains pure speculation. Given KTM’s deep ties with existing partners like Bajaj and CFMoto, such a move seems unlikely. Wherever the funds come from, Citigroup will continue to oversee financial transactions related to the restructuring.

Once the payments to creditors are complete, a judicial court will confirm the transactions in early June and sign off, making the agreement legally binding. Pierer also announced that production at its Mattighofen, Austria, facility will gradually ramp up beginning in mid-March, supported by €50 million in shareholder contributions. KTM aims to achieve full capacity utilization of its four separate production lines in a single-shift operation within three months. Previously KTM had deliberately reduced motorcycle production by 26 percent, scaling output back to 230,000 units. 

This will undoubtedly be good news for the Mattighofen-based workforce, which has borne the brunt of KTM’s financial struggles. Since the drama began in mid-2024, there have been hundreds of layoffs affecting production line workers, engineers, and administrative staff, delivering a significant economic blow to the local community and sending ripples of concern across Europe’s motorcycle industry.

Speaking on the game-changing vote, new KTM boss Gottfried Neumeister said, “I am grateful and happy today. KTM is back on track. Our employees have given their all over the past three months to ensure the race can continue.” With KTM now back in the game and set to remain in Mattighofen, it will continue to be one of the top employers in the Upper Austrian region.

The crucial vote, which took place in Linz, Austria on February 25, marked the end of a 90-day grace period granted to parent company Pierer Mobility after it voluntarily entered into a court-supervised restructuring process on November 29, 2024. This process allowed the company to self-administer a repayment plan for its creditors, who by January, had filed claims totaling nearly €2.2 billion. The lion’s share of the debt — around €1.7 billion — is owed to financial institutions, including banks.

The three-month restructuring period had been tumultuous, marked by numerous twists and turns, including the shocking day in early January when Stefan Pierer, long regarded as having the Midas touch when it came to shaping motorcycle empires, handed the reins to Neumeister, who has a stronger background in business administration and management. 

“I am deeply convinced that Gottfried Neumeister, with his strategic foresight and commitment, is the right choice to lead KTM into the future,” said Pierer at the time, noting he would remain a member of the company’s board. KTM’s most recent structural shift took shape at a January 27th supervisory board meeting, where Stephan Zöchling was elected as the new chairman. 

Also in January, iconic Italian brand MV Agusta, Stefan Pierer’s final acquisition before his company’s financial implosion and manufacturer of the Enduro Veloce, was sold back to the Sardarov family-owned Art of Mobility S.A. in an effort to recoup funds. The transaction, pending regulatory approval by mid-2025, marks yet another chapter in MV Agusta’s long history of ownership changes, though Sardarov acknowledged that KTM’s involvement ultimately strengthened the brand.

Most recently, KTM’s restructuring plan was challenged by a key creditor, U.S. hedge fund Whitebox Advisors, which publicly opposed Pierer’s plan to repay only 30 percent of creditor claims. Whitebox advocated for an alternative plan that would offer creditors a 45 percent recovery rate and up to a 20 percent equity stake in KTM, aiming to distribute the financial burden more evenly between creditors and shareholders.

“We have closed an important chapter today,” said new KTM boss Neumeister. “But a single chapter never tells the whole story. Now we can continue the great story of KTM.” 

And it’s true—despite all the recent turmoil, KTM has maintained its aggressive pace, launching new products across its brands and dominating the podium in racing. That includes a triumphant showing at the 2025 Dakar Rally, where Daniel Sanders clinched the Rally GP title aboard his 450 Rally, while Edgar Canet secured Rally2 honors on a factory-prepped 450 Rally Replica.

In addition to shoring up a fresh corporate strategy and winning races, we hope to see KTM continue to address grassroots issues with quality control in ways that will matter, such as its move to offer, on top of the standard two-year warranty, a free ‘Premium Manufacturers’ warranty that adds an additional two years (up to 4 years total) for those who bought a new unregistered LC8 or LC8c machine, model year 2023 or newer, from December 13, 2024 onwards. 

Extending the warranties for new buyers of LC8 and LC8c-powered models is a strong move in the right direction for KTM, though it will undoubtedly ruffle the feathers of consumers who previously purchased 2023-plus models the program excludes. However, it is a step in the right direction, and hopefully as KTM recovers its strength, it will continue on a path of appreciation for the loyalists who have made the company valuable enough to warrant saving in the first place.

Author: Jamie Elvidge

Jamie has been a motorcycle journalist for more than 30 years, testing the entire range of bikes for the major print magazines and specializing in adventure-travel related stories. To date she’s written and supplied photography for articles describing what it’s like to ride in all 50 states and 43 foreign countries, receiving two Lowell Thomas Society of American Travel Writer’s Awards along the way. Her most-challenging adventure yet has been riding in the 2018 GS Trophy in Mongolia as Team AusAmerica’s embedded journalist.