Stefan Pierer Moves Out From KTM CEO Position

Pierer Mobility Group, the parent company of KTM made a big announcement today as it revealed that Stefan Pierer will vacate his position as the CEO of KTM. The board has appointed Gottfried Neumeister as the new CEO of KTM and Pierer will take up the role of Co-CEO.

The above announcement doesn’t come as a surprise as KTM went into self-administration (to save itself from bankruptcy) as it reported a debt of around €2.5-2.9 billion (₹22,537 to 26,143 crore), which is an insane amount of money by any standards and more so with respect to losses. Gottfried Neumeister was the only remaining board member apart from Pierer when the company reduced four members as part of its cost-cutting exercise. Neumeister previously launched the budget airline Niki Air in 2023 with Formula One legend Niki Lauda in 2003.

Commenting on his removal as CEO of the company, Stefan Pierer said, “KTM was always more than just a company – it was and is a passion, a mission and a family. The decision to hand over the helm was not an easy one. I am deeply convinced that Gottfried Neumeister, with his strategic foresight and commitment, is the right choice to lead KTM into the future.”

So how did KTM and Stefan Pierer find themselves in such dire straits? There are a lot of factors resulting in KTMs debacle. First up was Covid 19 which disturbed its production cycle but that was the case for all the other brands too, however, KTM predicted there will be a huge demand post pandemic and increased its production capacity. However, on the contrary demand fizzed out and the market was struggling and the Austrian brand in return ended up with a huge stockpile of unsold bikes.

The inventory was close to 2,65,000 bikes, yes, that isn’t a typo! Next up was the MV Agusta acquisition which raised many eyebrows. The Italian brand in its current avatar is a very niche and boutique marquee and didn’t sit well with the KTM ideology. The other problem for KTM was the camshaft issues which plagued a lot of its motorcycles and the impact it had on the brand. Initially KTM dismissed the issue, but later had to issue a recall and for many bikers KTM’s reliability quotient was up for debate.

As part of the restructuring process, the Austrian brand has reduced its workforce by 1,800 employees and also reduced its production. The company also stated that it has been able to cut its inventory by 40,000 units and this was the reason why KTM big bikes were reintroduced in the India market. There are rumours that brands MotoGP programme could also face the axe in an attempt to save costs and we hope that doesn’t happen as KTM is among the strongest contenders for the 2025 season.

As for the future of the company, it remains to be seen whether it manages to get fresh investment or it will be brought out. Bajaj Auto through its subsidiary Bajaj Auto International Holdings BV holds 49.9 per cent stake in Pierer Bajaj AG, which in turn holds 75 per cent stake in Pierer Mobility. While Bajaj Auto looks the strongest contender, the impact of performance bikes in its portfolio is uncertain as its focus is on mass market motorcycles and electric scooters. The other strong contender is KTM’s Chinese partner CFMoto as the Austrian motorcycles fit well with its ambitions of establishing itself in the premium performance motorcycle segment. More details are expected post the January 27 meeting with its creditors.