Motorcycle manufacturer KTM is cutting up to 500 employees in the Innviertel. Reason: cost disadvantages in Europe, a slower pace of development than in Asia, plus faltering demand in the US. Not everyone can understand the austerity package. The reactions are sometimes intense.
Although turnover rose to 2.66 billion euros last year and profit before interest and taxes amounted to 160 million euros, Pierer Mobility put together a savings package: at least 300 employees in both production and research and development in Mattighofen and Munderfing have to go because there are cost advantages in Asia compared to Europe and the speed of development for e-mobility is higher there. But now as many as 500 jobs could be lost as demand falters, especially in the US.
“Then he also has to sell his stuff in China or India.”
The cost-saving program at the motorcycle manufacturer with the brands KTM, Husqvarna, MV Agusta and GasGas is raising eyebrows. A heated discussion is raging on krone.at: “Hardly get any subsidies and as soon as there are a few dark clouds in the sky, immediately fire staff and move,” someone says angrily.
Another wrote to owner Stefan Pierer: “Then he should also sell his stuff in China or India.” The anger is so great that some are considering a boycott of purchases and making this clear with “I don’t need a KTM anymore.”
“Although 160 million profit was made, the workers must serve to make even more profit. “You must also take responsibility for all employees,” demands a reader on krone.at. But there is also understanding in Asia for the steps based on cost benefits. “Austria has become too expensive as a production country” and “Indirect labor costs are causing our companies to leave”, are some of the comments.
He had to pay back taxes on 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 criticism…
Stefan Pierer may be many things, determined and hungry for success, but he is certainly not one thing: everyone’s favorite. The 67-year-old is now one of the richest Austrians. The fact that Pierer Mobility now employs up to 500 employees, which includes the motorcycle brands KTM, Husqvarna, GasGas and MV Agusta, as well as an e-bike segment, has now become a reality. The fact that he only had profit maximization in mind is one of the friendlier accusations.
Does this mean we should feel sorry for him? No. With his harsh words towards politicians and the EU, the entrepreneur repeatedly seeks public attention and runs the risk of criticism if something does not go well with him.
Whoever hands it out must also accept it: It was clear that there would be headwinds for job losses in the Innviertel, where KTM has almost tripled the number of employees since 2011. With all the Pierer bashing, people tend to forget that regulatory fury and huge cost increases are putting Europe on the back foot and that not only KTM is coming under pressure, but other companies are also increasingly investing abroad. What will that ultimately mean? It won’t be a job seeker.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
