KTM Bust

How the hell can you get £200,000000 in dept.
Surely can't be a stupid attitude like "we can ride this out" not knowing when to quit.

Same applies to their suppliers.....they should cut off supplies and tell them you'll get more supplies when we get paid.
 
pappajohn said:
How the hell can you get £200,000000 in dept.
Surely can't be a stupid attitude like "we can ride this out" not knowing when to quit.

Same applies to their suppliers.....they should cut off supplies and tell them you'll get more supplies when we get paid.
Click to expand...
It’s not their problem, it’s the lenders problem👍
 
pappajohn said:
How the hell can you get £200,000000 in dept.
Surely can't be a stupid attitude like "we can ride this out" not knowing when to quit.

Same applies to their suppliers.....they should cut off supplies and tell them you'll get more supplies when we get paid.
Click to expand...
€2,420 million in sales easily attracts a running debt of that amount. https://www.mcnews.com.au/ktm-group-achieve-record-turnover-and-sales-figures-for-2023/
Sounds a lot to you and me, but not in the scheme of things when they can shift a billions worth of product

what mystifies me is they had record sales in 2023,
somebodies been naughty or completely inept. Sounds like the parent company may be erm.....OK .... ;)

Subscribers  do not see these advertisements

 
pappajohn said:
Yes, but the company will lose everything and the various companies being owed will get some money back.
The suppliers should have said enough when they realised that KTM were getting into deeper dept.
Click to expand...
probably spread between 100s of suppliers, each one will be lucky if they get 5p in the £
bad news
 
Apparently due to poor quality and over production according to their statement in this report yesterday.

newatlas.com

As financial woes worsen, KTM takes drastic measures to cut losses

It was just a couple of years ago that Pierer Mobility-owned KTM celebrated 12 straight years of record growth. Now, the company is in a dire crisis that requires a halt in production and the sacking of more than 300 employees. How did it get here?
newatlas.com newatlas.com
 
Thats surprising, A lot of shared manufacturing in China and India so costs would have been low so maybe the backlash of undermining the brand?
 
Tombola said:
€2,420 million in sales easily attracts a running debt of that amount. https://www.mcnews.com.au/ktm-group-achieve-record-turnover-and-sales-figures-for-2023/
Sounds a lot to you and me, but not in the scheme of things when they can shift a billions worth of product

what mystifies me is they had record sales in 2023,
somebodies been naughty or completely inept. Sounds like the parent company may be erm.....OK .... ;)
Click to expand...
There's a vast difference between turn over (Sales) and profit.
 
Last edited:
L' Hobo said:
There's a vast difference between turn over (Sales) and profit.

Back in the early 2000's, my Coach & Bus Company had a VERY busy year with the buses doing local stage work, schools and Railway Replacement for South Rail and the London Underground during the evenings & School Holidays and the Coaches doing Touring & Ski work.
(I think I had ONE day off that year!)

This all culminated in the company of only 9 vehicles, at that time, having a turnover of nearly £750,000 ( three quarters of a million pounds) BUT, by the time we had paid for new vehicles, paid fuel, drivers, mechanics etc. we only cleared £18,000 profit.

Still a nice wodge for my back pocket, but....as I said, Sales without Profit means very little! 🤔
Click to expand...
Then, you were not charging enough!

Most of your costs are known, price of fuel, cost of a driver, mechanic etc.
Things like new busses and other kit, all have a predictable obsolescence period, call it 9 years, which means the profit has to buy one new bus a year, every year.
Also a fair percentage of the profits should go into a 'rainy day fund', to run the company for at least 3 months with zero income.

£18k could have been wiped off with a single accident, strike, bad weather, theft, etc.,

With a 750k turnover your final profit, after costs, should have been over £75k and actually closer to double that.
 
So have they gone bust or still seeking investment? Bajaj own 49% I think so unlikely they will want to loose that..and Bajaj are HUGE, just not in Europe.
 
They managed to ride out the Moto GP season.

I wonder whether they will be back and what the other teams will do that use their engine??

I’ve never owned one but ridden a few.
Stupid quick but maybe a bit fragile and requires a fair amount of maintenance??
 
There is a story here
About a Recycling plant that closed down recently, all the staff laid off and now doubt all the suppliers told to whistle for their money.

Somebody nicked the entire plant!

Bet it was a disgruntled supplier, and I'll bet a number of the ex mechanics must have got a fair bung for a few days overtime cash in hand to assist with the removal, as you don't just steal 10 HGV loads of heavy machinery without a lot of help.
 
Brains said:
Then, you were not charging enough!

Most of your costs are known, price of fuel, cost of a driver, mechanic etc.
Things like new busses and other kit, all have a predictable obsolescence period, call it 9 years, which means the profit has to buy one new bus a year, every year.
Also a fair percentage of the profits should go into a 'rainy day fund', to run the company for at least 3 months with zero income.

£18k could have been wiped off with a single accident, strike, bad weather, theft, etc.,

With a 750k turnover your final profit, after costs, should have been over £75k and actually closer to double that.
Click to expand...

Like you, I know the business school theory but, why should I give the Taxman any of my profit when I could buy a new Coach which is what I did. 🤔

PS. When one is operating in the VERY competitive market of Surrey on the outskirts of London with the erratic fuel prices etc. of the early 2000's, sometimes the Business School Theory of the Accountant, doesn't always add up as can be witnessed by large companies going to the wall and the financial crash a few years later.

By the way, none of the big Touring companies like Leger, Shearings etc. who hired in contracted seasonal Tour Coaches will entertainment a coach older than 3years, not the 9 year obsolescence of which you speak! 😄
 
Last edited:
Brains said:
Then, you were not charging enough!

Most of your costs are known, price of fuel, cost of a driver, mechanic etc.
Things like new busses and other kit, all have a predictable obsolescence period, call it 9 years, which means the profit has to buy one new bus a year, every year.
Also a fair percentage of the profits should go into a 'rainy day fund', to run the company for at least 3 months with zero income.

£18k could have been wiped off with a single accident, strike, bad weather, theft, etc.,

With a 750k turnover your final profit, after costs, should have been over £75k and actually closer to double that.
Click to expand...
Exactly this.

Far too many business flogging away and reaping very little.
I'm surprised at how many I come across that seem to think being the cheapest and selling more product will work.

Rarely does. You need cost efficiency, rainy day planning and excellent productivity.
 
Red bull saving KTM Moto GP

A friend of mine recently visited KTMs new facilities in Europe and America. That also house Husky and GasGas.
Somehow they will sort it out I believe

Subscribers  do not see these advertisements

 
Silver-Fox said:
I’ve never owned one but ridden a few.
Stupid quick but maybe a bit fragile and requires a fair amount of maintenance??
Click to expand...
I’ve owned several KTM Adventure bikes for leisure and commuting, 990, 1190, 1090, 1290 in both S and R guises. In my experience they were no less reliable or in need of more maintenance than the BMWs which preceded them (other than the 990 may have had shorter service intervals and the chain v shaft drive related lubrication/tensioning/replacing difference etc).
 
I was just reading the other day about their financial troubles. Apparently it's been caused by a few factors. The purchase of Gasgas, the weak dollar, their insistence on making large expensive motorcycles instead of the smaller more profitable ones, the camshaft reliability problems on the LC8 twin engines, which they are still denying exists and refusing to fix under warranty and I think Moto GP was mentioned.
Also they have lost 90% of their stock exchange value since last year.
 
The main reason KTM is in trouble is major design fault in 790 /890 LC8 engine where oil ways are missaligned leading to cam and engine failure, over 25,000 bikes less than 4 years old so far with KTM in denial adn thousand more potentially grenades even new ones as KTM will not make the changes needed in production, and claiming other reasons for the huge number of blown engines ,,sales have collapsed,, also poor quality control in most models even when made in Austria and not China or india , they are not helping the dealers out with warranty issues ,,

They blame CF moto who make the 790 in China for production issues in the engine drillings but ignore the fact that 890 has same problems and is made in Austria ,,, because its a terrible design half the oil ways in the heads are blocked !!!!!!

I have seen inside of 4 LC8 engines 2 were only 6 months old all have the oil ways blocked or off centre all need new heads , cams and possibly more if metal shavings have trashed the crank and gearbox, the replacements also have the same issues so no cure .

Dealer are bullied into carrying way more stock then they can sell and due to the collapse of sales in the brand are unlikely to be able to sell the bikes as more and more people see the problems or talk with people who have bought these defective machines ,,

KTM are also refusing to fix the problems under warranty as they truly dont have an affordable cure ,, A proper cure will bankrupt them as it will cost over $1.4 billion ,, There are also court cases against the group and EU and USA regulators and consumer groups are after them ..
 
Lots of detailed technical evidence of LC8 engine issues on Google, You Tube etc ,, lots of miffed owners , even angry dealers , mechanics etc ,, also lots of excuses and obfuscation by KTM .. But they are in big trouble,, Pierer group KTMs parent is being investigated by EU for finacial irregularities ,, its stock and debt are subject to banking investigations . Debtors and banks involved are writing it off as likely to fail,, it will be like Norton or Buell, or others cherry picked and bought out by someone for the names , technology etc ,,, HD is also on the edge financially as well as poor quality ,fading demographics of customer base and disasterous sales of some new models which are seen as over priced and bland and planned move of production to Thailand is not going down well with old timers ,, wheras Indian are stealing HDs customers and doing rather well.
 
Brains said:
Then, you were not charging enough!

Most of your costs are known, price of fuel, cost of a driver, mechanic etc.
Things like new busses and other kit, all have a predictable obsolescence period, call it 9 years, which means the profit has to buy one new bus a year, every year.
Also a fair percentage of the profits should go into a 'rainy day fund', to run the company for at least 3 months with zero income.

£18k could have been wiped off with a single accident, strike, bad weather, theft, etc.,

With a 750k turnover your final profit, after costs, should have been over £75k and actually closer to double that.
Click to expand...
Great theory. not always so easy to easy to achieve in practice, especially when you re trying to get a new business off the ground.
 
Splitting hairs but is the problematic parallel twin (‘chocolate cam’) engine not the LC8c in the more recent 790/890 bikes?

I think the LC8 is the V-twin which has been around and developed for a long time (old 990, RC8, 1290).
 
KTM have been masters of dumping on their existing customers by knocking big chunks of the 'current' bikes to make way for the next years model. Imagine buying a new £15k motorbike to find that a month later you can buy the same model brand new for £12500....you month old bike is now worth about £10k...

Subscribers  do not see these advertisements

 

Join us or log in to post a reply.

To join in you must be a member of MotorhomeFun

Join MotorhomeFun

Join us, it quick and easy!

Join us

Log in

Already a member? Log in here.

Latest journal entries

Back
Top