It’s official: KTM is shifting part of its production to China, shaking up the global motorcycle scene with a bold move that aims to make bikes more competitive—but what does this actually mean for loyal riders and the brand’s future?
A Strategic Shift: Why China (and India)?
The Pierer Mobility Group, the powerful European player that now owns KTM, is making waves by overhauling its entire production network. After a notable 16.5% boost in sales during the first half of 2023, the Austrian-based motorcycle giant is sharpening its focus squarely on its star brands: KTM, GasGas, Husqvarna, and MV Agusta. That means saying farewell to the bicycle lines R Raymon and Felt—a clear sign that motorcycles are firmly in the driver’s seat, not just in garages but also in corporate strategy.
This isn’t just shuffling management or tweaking slogans; it’s a seismic shift. Part of KTM’s production is moving out of Austria, heading east to China and India thanks to collaborations with CFMoto and Bajaj. Some might call it globalization, others call it ‘following the money’—and either way, the ramifications are set to reshape KTM’s outlook at every level.
Partners, Production, and Perceptions
The collaboration with CFMoto in China marks the opening of a new chapter for KTM. For years, European and American riders eyed anything ‘Made in China’ with suspicion, raising eyebrows over quality control. But times—and manufacturing standards—have changed. Chinese producers have shown they can deliver high-quality vehicles at a fraction of European costs. For KTM, this is about cutting production expenses and, equally crucial, solidifying their presence in Asia’s rapidly expanding markets.
Meanwhile, India remains a major piece of KTM’s puzzle. Partnering with Bajaj, KTM has already shifted production of some mid-range models—namely the 790 Duke and 790 Adventure—right into Indian factories. The main draw? Labor costs are much lower in India than in Europe, giving KTM the kind of price flexibility needed to thrive worldwide. It’s a shrewd move that could keep these models in contention on the global stage, especially as competition intensifies.
The Human Side: Restructuring and Its Costs
Of course, cost cutting and relocation don’t come without a price. The restructuring will lead to the loss of 300 jobs in Austria. This is part of Pierer Mobility Group’s wider strategy to make operations more efficient, but the social repercussions are significant—and not being ignored. Despite these cuts, the company says it’s using its strong financial position to support dealers and suppliers struggling with stiff banking rates, aiming to soften the blow for those affected by these big changes.
Looking ahead, Pierer Mobility is optimistic for 2024. The goal is to keep sales at 2023 levels, with an EBIT margin in the 5% to 7% range. Ambitious? Maybe. It will demand yet more cost-reduction measures, potentially saving tens of millions of euros. But the move to CFMoto isn’t just about sharpening the bottom line; it’s also an opportunity for KTM to reinforce its place in Asian markets, where the appetite for powerful bikes is picking up speed—faster than a KTM off the line, you might say.
MV Agusta, and The Road Ahead
It’s not just KTM in the spotlight here. Pierer Mobility has emphasized the strategic value of MV Agusta, reassuring staff at the Schiranna plant that the Italian icon is set for a prosperous future under their wing. MV Agusta models—including the buzzworthy new LXP Orioli with a 900cc three-cylinder engine—are grabbing attention as the group plans for wider global distribution. KTM AG’s plan to acquire a majority stake in MV Agusta in 2026 is due to be a game-changer for the legendary brand, closing the book on years of financial uncertainty.
- Focus on core motorcycle brands (KTM, GasGas, Husqvarna, MV Agusta)
- Shifting part of production to China with CFMoto
- Mid-range model production moved to India with Bajaj
- 300 Austrian jobs lost due to restructuring
- Ongoing company support for struggling dealers and suppliers
- Strong ambitions for 2024 in terms of sales and profit
As KTM looks to remain competitive by moving production to countries with lower costs, the real test will be in rider reactions. Integration with manufacturing partners and a keen eye on Asia could pay off, but KTM must strike the right balance: attractive prices without sacrificing the high build quality that earned them so much respect. Riders everywhere will be watching—wallets ready—to see if these changes mean cheaper bikes, or if the riding experience they love stays untouched amid all the change.
John is a curious mind who loves to write about diverse topics. Passionate about sharing his thoughts and perspectives, he enjoys sparking conversations and encouraging discovery. For him, every subject is an invitation to discuss and learn.
