The saga of KTM and its parent company Pierer Mobility Group’s financial troubles continues, with official filings by Austria’s judiciary confirming that the once seemingly unstoppable Orange brand has put its 50.1 percent controlling stake in MV Agusta up for sale. 

During the hearing, it was decided that KTM can continue operating under self-administration for now, allowing the company to manage itself while undergoing restructuring. Moreover, KTM Group, which controls more than 60 subsidiaries, will be guaranteeing continued financial support to only two of its main branches ;  KTM Forschungs & Entwicklungs GmbH which handles research and development and KTM Components GmbH, which specializes in producing key components and parts for KTM motorcycles. Payments to the remaining subsidiaries will be halted, pushing several of those sub-entities toward their own insolvency issues. 

Further organizational measures published in the hearing report include consideration of a partial relocation of KTM’s facilities from Mattighofen, Austria, to a less expensive location, as well as the selling of shares of Pierer Immoreal GmbH, a PMG subsidiary primarily involved in real estate activities, including the development, acquisition, and management of properties. 

Acceptable restructuring will require the entry of an investor, and this process will be overseen by Citigroup Global Markets Europe AG, a subsidiary of Citigroup, Inc., to find an investor solution.

On the brighter side, the report stated that KTM does have enough cash flow to keep the company going until the next hearing, which will be January 24, 2025. Plans to cut additional staff in the first months of 2025 have been downgraded from 500 necessary layoffs to 300, plus the restructuring administrator expressly emphasized that the wages and salaries of employees for December can be paid. Good news, though let’s keep in mind KTM already expelled around 573 employees in 2024.

Especially good to hear was that there is evidently a mystery investor on the line, one that has been in contact with Pierer and its court-appointed administrator. Signs of a basic agreement between parties will need to be in place ahead of a second mid-January hearing, and in the meantime, KTM’s finances and future plans are being continuously monitored and adjusted by court-appointed oversight.

To recap, Pierer Mobility Group, a.k.a. KTM Group — which also owns Husqvarna and GasGas — voluntarily entered insolvency proceedings on November 29, citing €2.9 billion (more than $3 billion USD) in liabilities, impacting 2,500 creditors and over 3,600 employees.

The move to a formal insolvency marked a milestone in KTM’s months-long public-facing spiral. However, it’s now clear that the company’s financial instability began eroding under pandemic-driven demand and subsequent overproduction during a timeframe when manufacturing disruptions affected overall quality control, though ongoing camshaft failure reports in KTM’s LC8c-powered lineup appear to be a separate issue.

Following the bout of overproduction, an ensuing glut of product caused even deeper problems for KTM as global inflation swept the world, leaving thousands of units to loiter on showroom floors while dealers wrestled with high interest rates. For a consumer, there has never been a better time to buy a KTM, Husky or GasGas machine, as units are currently being marked down at clearance prices. 

AKV Europa also reported that increased costs of materials, energy and personnel as being a factor, and that outsized investments financed by debt have increased KTM’s liabilities. 

Among these investments was the purchase of the controlling stake of iconic Italian brand MV Agusta in March, 2024. Following some early-December rumors that MV Agusta was also in trouble and facing a fire sale, the maker of the new Enduro Veloce adventure bike, issued a statement addressing rumors about its future and its relationship with KTM. 

Of course, the best-case scenario for MV would be that all operations continue to remain rooted in Varese, Italy, where, by its own accounting, it is not only surviving, but prospering, emphasizing a 116 percent increase in annual sales as a testament to the brand’s strength. The company also pointed to its plans to expand its global network to 250 dealers by the end of 2025 to show growth, up from 219 dealers as of July, 2024. 

Sadly, according to the insolvency hearing report, one planned deletion from KTM’s portfolio is its MotoGP program. Having entered the famously competitive international road circuit series in 2017 as Red Bull KTM Factory Racing, it had only been improving its performance year after year before financial disaster struck. 

In light of KTM’s devastating financial troubles, it’s not surprising World Rally fans might be concerned KTM’s off-road program, including its efforts at Dakar 2026, could be the next extracurricular asset to face the axe. However, one can hope that the brand’s unmatched success in that arena — particularly at Dakar with its record of 18 consecutive wins (2001–2019) — will keep it going strong, given its pivotal role in solidifying KTM’s brand identity.

Despite KTM’s uncertain future, it will be exciting to watch its Factory riders — two-time Dakar champion Kevin Benavides, his rising-star brother Luciano Benavides, and Daniel Sanders, who finished 4th overall for his Dakar debut in 2019 — as they dice their way across desolate and unforgiving Saudi desertscapes beginning with the prologue on January 3rd 2025. 

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.