MEET THE THE MAN WHO SAVED KTM FROM THE ASHES .. AND NOW WANTS TO SAVE HUSKY

December 17, 2013
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KTM’s Chief Operating Officer Stefan Pierer came to KTM 20 years ago when it was in the throws of bankruptcy. With calculated and careful moves, Pierer’s leadership turned KTM from an also-ran into the most powerful motorcycle racing company in the world. Under Stefan Pierer’s guidance sales increased to the point that KTM sold 108,000 motorcycle in 2012?most of them offroad bikes. KTM is now the fastest growing motorcycle company in USA. Here are Stefan Pierer’s thoughts on a wide variety of subjects.

ON SURVIVING THE ECONOMIC CRISIS
“You cannot sit there and wait; it doesn’t get better that way. In very tough circumstances you can get the best market shares. One of the big success stories of KTM was that we were the fastest moving, most aggressive and most ambitious motorcycle company through the economic crisis and now we are harvesting that success. The Japanese were sitting and waiting. Honda moved a bit, Yamaha was a disaster and Kawasaki did a good job. Suzuki is disappearing from the market.”

ON SUPERCROSS, DECOSTER AND AMERICA
“For many years I was not convinced that a huge investment in American racing would pay back, but after the economic crisis we were influenced by our American staff to invest. Pit Beirer was able to persuade Roger DeCoster to come to KTM and we decided to take Supercross seriously. I have to say I am positively surprised by the payback?incredible! Supercross is the showcase in the States and that was a learning curve for me.

“I was worried about too much money in that segment if it didn’t work out, but with KTM’s professional set-up and DeCoster as the team manager, the success is coming. We have good riders and the United States market is one of our growing areas. Last year we were up 20 percent and this year we are up 15 percent even though market is flat. I think that growth is down to Supercross success.”

ON HUSKY’S REPUTATION

“Husqvarna was the benchmark at the beginning of the sport. It was a competitor that kept getting better year-by-year. In the mid 1990s we took over Husaberg, which was a spin-off from the former Husqvarna engineers when they left the company when moved down to Castiglioni and Cagiva. We got some experience from them and in 2003 we closed down the facility in Sweden and brought the operation down to Austria. It worked out very well. We were very impressed.

Maybe Husaberg was partly the killer of Husqvarna because last year Husaberg sold 6000 units, more than Husqvarna for offroad.

Our experience with Husaberg as a second brand that overlapped our main brand was useful and so was adapting the platform strategy from the car industry. In other words, sharing engine and chassis components as much as possible between brands. With platform sharing you don’t need additional R&D, purchasing and production. After ten years with Husaberg I was 100 percent sure that we could handle a second brand and then the possibility came up to buy Husqvarna.

ON HUSABERG’S LIMITATIONS
“Husaberg had one weakness. In Europe it is a solid brand and it is strong, but outside of the European continent nobody really knows it. In the United States it is unknown?but that is not true for Husqvarna. Husqvarna brought the sport to America and is considered to be one of the pioneers of motocross. It has a long history in the United States and the brand is recognized everywhere around the globe. It is the second oldest motorcycle brand.

“When the situation came up at BMW where they recognized that they needed to focus on road bikes during the economic crisis, they wanted to get rid of their offroad bikes. We had a clear plan to create a single brand with Husaberg being merged and Husqvarna being the strong global brand for the future.”

ON THE 2015 HUSQVARNAS

“With the platform, we will redo some things on the Husaberg models to convert them to Husqvarnas, mainly with the colors, graphics and technical improvements. For motocross we will use the KTM platform and…we will have a very strong competition line for every displacement in motocross, meaning 250, 350 and 450 four-strokes and 125 and 250 two-strokes, plus all the models that Husaberg had for enduro. This will include a 690cc single-cylinder bike. It will be perfect model line, so Husqvarna dealers can survive in the offroad segment. That gives us the chance to have a second distribution line against the Japanese. Husqvarna is strong enough on a global basis to be able to attack the Japanese or to lift the Europeans up against the Japanese; that is the concept.”

ON HUSKY VERSUS KTM
“You have to have the brand content separate from KTM. KTM is perhaps a bit more ?to the edge’ and more race-orientated. Husqvarna will come out as more historic, more Scandinavian and a little bit smoother. The design, as you will see in the future, will be a bit softer than the KTMs. Husqvarna will focus on the Supermoto style of bike for on-road. There are a lot of niches that Husqvarna can occupy and become a serious player again.”

ON WHY KTM CAN SUCCEED WHERE BMW FAILED

“First, we have 20 years experience in the offroad niche market. It is a very specific market and you need experienced people: former racers and skilled technicians. Every small detail must be pursued with hard and consistent work to create the right product.

“Second, the offroad community is a closed community and if you are not part of it then you are making a mistake.

“Third, Italy, as an industrial base, is one of the most difficult, aside from France, because of the labor regulations. Italy is not competitive any more. First of all you need to pay a lot of money to have a nice Italian company and brand. Then, you need to pay a lot of money to get rid of that company. That was the background situation when I came to meet with BMW.

“They asked if I was interested in Husqvarna because they wanted to focus on road bikes. I said ?why not? Let’s sit together’. It was as simple as that. It sounds easy and it was easy. We are very excited now, especially when we think about the new model program. For KTM’s factory in Mattighofen, Austria, it means 15,000 additional bikes based on the same platforms. It is like the car industry with Volkswagen and Seat, Audi and Skoda. In the market place the brands are separate, but behind the scenes there are synergies. That is the only way to survive on a small scale and in a competitive industry.”

ON WHY KTM DOESN’T HAVE ITS OWN MOTOCROSS TEST TRACK
“It would be nice! A motocross and enduro course for zero emission bikes is already at the factory, but we have tried for the past 20 years to build a motocross test track. It has been impossible and it is unbelievable how many arguments from neighbors have come up. It is a sad thing because because we are employing almost 3000 people in the region. Many people are benefitting from KTM, but we are not able to do a test track. We even have 50 acres of land set aside for it. The E-bike track was immediate, but a normal track is much harder. For us it means a bottleneck for our R&D department because means extended sessions in Italy or Spain.”

 

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