Production starts

After bankruptcy: KTM comeback with many question marks

Around 1,000 employees were recently condemned to inactivity, receiving a wage equivalent to a 30-hour week.

(Bild: Wenzel Markus)

It is a very important step towards normality - and yet many question marks remain. 94 days after KTM's motorcycle production in Mattighofen was sent into a forced break, the ramp-up phase of the assembly lines begins on Monday. In the background, talks with investors are in full swing at the Upper Austrian company, which recently slipped into insolvency.

Motorcycle production in Mattighofen was forced to take a break due to the excessively high stock levels: The traditional Christmas shutdown had been started a week early, after which there was no resumption of assembly. Until now.

Because today, Monday, the official ramp-up phase of production begins, about which KTM itself is being decidedly tight-lipped. The assembly lines will be gradually ramped up almost three weeks after the successful vote on the restructuring plan, it is said. Four production lines are planned, which will be brought to life in single-shift operation. Full capacity utilization is expected within the next three months, i.e. in mid-June.

First motorcycles will roll off the production line on Thursday
Despite the turbulence of recent months, the resumption of production should proceed as normally as possible. The first few days will be dominated by the delivery and inspection of goods, various pre-assemblies and the start of sample and prototype construction. The first motorcycles will then roll off the production line on Thursday.

Our employees have given their all over the last three months to ensure that the race can continue. KTM is back on track.

Gottfried Neumeister, Vorstandschef der KTM AG und der Pierer Mobility AG, nach der erfolgreichen Sanierungsplanabstimmung

Parallel to motorcycle production, operations at KTM Components GmbH are also starting up again. Various parts, such as suspension forks, are manufactured there for the high-horsepower bikes.

In the course of the insolvency proceedings, KTM parted company with 470 employees. The remaining 1000 employees in the production environment have been at home since mid-December, receiving a wage equivalent to a 30-hour week. 

Indian co-owner finances the resumption of production
The comeback of production in mid-March is an important step towards normality and everyday life - but many question marks remain. The fact is that the 50 million euros that co-owner Bajaj recently injected into the company will apparently only cover the costs until the end of March.

After that, a further 100 million euros will be needed to keep production going. The Indian company has made a fundamental concession to cover this amount as well, but nothing is fixed. Immediately after the successful vote on the restructuring plan for the KTM Group, Pierer Mobility AG itself announced that fresh capital of around 800 million euros was needed to finance the 30 percent quota for creditors and continued production. The investment process is underway, but no white smoke has yet arisen.