Pierer Mobility, the parent company of KTM, Husqvarna, GasGas and WP Suspension and 50.1% owner of MV Agusta, has announced further redundancies in response to weak sales figures in 2024. 373 jobs were already cut at the beginning of the year and now a further 200 employees are to lose their jobs in the third quarter of 2024. This brings the total number of employees made redundant this year to 573.
Relocation of production and reduction of manufacturing in Austria
In addition to the job cuts, Pierer Mobility is planning to reduce production in Austria by 25%. Instead, the company will increasingly focus on relocating production to India and China, where it wants to take advantage of more favorable production conditions. This is part of a comprehensive strategy aimed at stabilizing the company’s financial situation after net debt rose to €1.469 Mio.
Sporting activities and global market conditions
In addition to reducing production capacity in Austria, Pierer Mobility is also planning to reduce its sporting activities. These measures should help to get the company back on track as it adapts to the challenges of the global motorcycle market.
The global market situation has been described by Pierer Mobility as “challenging”. While the European market, the company’s largest trading area, and India were described as “slightly positive” and “positive” respectively, the markets in North America, Australia and China declined.
Declining sales figures and future prospects
Pierer Mobility already recorded a significant decline in sales figures in the first half of 2024 compared to previous years. A decline in sales figures of up to 15% is expected for 2024 as a whole. This has contributed significantly to the decision to take drastic measures such as job cuts and the relocation of production.
Pierer Mobility currently employs a total of 6,024 people, after the full consolidation of MV Agusta added 213 additional employees to the company. Despite the challenges, the company hopes to return to a stable course by 2025 thanks to the measures it has introduced.
Conclusion
Pierer Mobility is facing considerable challenges in 2024, which have forced the company to make tough cuts. By focusing on cost reductions and relocating production, the company is attempting to cushion the impact of the decline in sales and secure its market position in the long term. It remains to be seen whether these measures will be enough to get Pierer Mobility back on track for growth.
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