Woes deepen for KTM as money problems are laid bare
New figure placed on liabilities exceeds €2.5 billion
Struggling Austrian motorcycle manufacturer KTM’s debts could be as high as €3 billion according to fresh reports as the company enters self-administration.
KTM’s money troubles have dominated headlines for the last few months, with alarm bells raised in October when its board of directors was cut from six to two members.
Since then, KTM has been forced lay-off hundreds of employees, while thousands of unsold bikes in showrooms is forcing it to temporarily cease production in January.
Last week, KTM announced that it would be entering self-administration to undergo a restructuring process in order to stave off bankruptcy.
Those proceedings began on Friday, which has revealed the true extent of the financial woes facing the Pierer Mobility Group and KTM.
According to insolvency expert Cornelia Wesenauer, quoted by GPOne: “It was clear that the liabilities of the KTM companies would reach a high level.
“Nevertheless, we are surprised that the liabilities are so high. After all, at first glance, we expect liabilities of €2.5 to €3 billion. That is now clear. This is the largest insolvency procedure in Austria this year.”
Earlier this year KTM cited a change in demands from key markets and the recession in Germany as reasons for its declining financial health.
According to GPOne, KTM generated a profit of €100m in 2023, showing just how rapid the situation has deteriorated. Since their peak in February 2022, KTM’s shares have decreased in value by 90%.
KTM is set to ensure December salaries are paid for its staff despite the uncertainty over their jobs. However, November salaries and Christmas bonuses will need to be covered by the Insolvency Wage Fund.
Motorsport boss Pit Beirer recently stated that the MotoGP project for 2025 is continuing as planned.
KTM is currently set to field Pedro Acosta and Brad Binder at its factory team in 2025, while the works-backed Tech3 squad will run Maverick Vinales and Enea Bastianini.
The financial issues at the company have forced a reduction in its motorsport presence, though, with brands like GASGAS and Husqvarna disappearing from the grand prix grid.
