Job cuts in the Innviertel

Boycott? Cost-cutting package at KTM raises eyebrows

KTM boss Stefan Pierer is on the cost brake: parts of production will be relocated and jobs will also be lost in development.

(Bild: REUTERS, Harald Dostal, Krone KREATIV)

Motorcycle manufacturer KTM is laying off up to 500 employees in the Innviertel region. Reasons: cost disadvantages in Europe, a slower pace of development than in Asia, plus stuttering demand in the USA. Not everyone can understand the cost-cutting package. The reactions are sometimes fierce.

Although turnover climbed to 2.66 billion euros in the previous year and earnings before interest and taxes amounted to 160 million euros, Pierer Mobility has put together a cost-cutting package: At least 300 employees in production and in research and development in Mattighofen and Munderfing will have to go because there are cost advantages in Asia compared to Europe and the speed of development for e-mobility is also faster there. Now, however, up to 500 jobs could be lost because demand is stuttering, especially in the USA.

"Then he should also sell his stuff in China or India"
 The cost-cutting program at the motorcycle manufacturer with the brands KTM, Husqvarna, MV Agusta and GasGas is causing a stir. There is a heated discussion on krone.at: "Grab a lot of subsidies and as soon as there are a few dark clouds in the sky, immediately cut jobs and relocate," writes one angry commentator.

Another writes in the direction of owner Stefan Pierer: "Then he should sell his stuff in China or India." The anger goes so far that some people are considering a boycott and make this clear with "I don't need any more KTM".

"Although a profit of 160 million was made, the workers have to make do in order to make even more profit. We should also take responsibility for all employees," one reader demands on krone.at. However, there is also understanding for the steps justified by cost advantages in Asia. "Austria has become too expensive as a production country" and "The non-wage labor costs are causing our companies to emigrate," for example.

KOMMENTAR

Wer austeilt wie Pierer

He had to pay back taxes because of a life insurance policy in Liechtenstein; he made a name for himself as a major donor to Sebastian Kurz; subsidies for the KTM Motohall in Mattighofen also came under fire ...

Stefan Pierer may be many things, determined, hungry for success, but there is one thing he is certainly not: Everybody's darling. The 67-year-old is now one of the richest Austrians. The fact that up to 500 employees at Pierer Mobility, which owns the motorcycle brands KTM, Husqvarna, GasGas and MV Agusta, as well as an e-bike segment, are now having to leave, is something he is now getting his comeuppance for. The fact that he only had profit maximization in mind is one of the friendlier accusations.

"OÖ-Krone" business editor Barbara Kneidinger.

(Bild: Stock Adobe, Krone KREATIV)

Does that mean we should feel sorry for him? No. With his harsh words for politics and the EU, the entrepreneur is always seeking the public spotlight and therefore also risks being criticized when things don't go so smoothly for him.

Those who dish it out must also take it: It was clear that there would be headwinds for the job cuts in the Innviertel region, where KTM has almost tripled its workforce since 2011. With all the Pierer-bashing, it is often forgotten that regulatory frenzy and enormous cost increases are putting Europe behind and that not only KTM is coming under pressure, but also other companies are increasingly investing abroad. What will this mean in the end? It won't be a job engine.