Better late than never, KTM, Husqvarna and GasGas parent Pierer Mobility has finally unveiled record revenue and intermittently attractive results for the first half of 2023, at least underlining its reputation as Europe’s largest motorcycle manufacturer by a considerable margin.
Six-monthly turnover for the Austrian enterprise climbed by 20.2% to £1.189bn. Global motorcycle sales volume was 16.5% up to 190,293 units, with segmental revenue contribution rising by about 19%. Sales of e-bikes and pedal cycles increased by 38.9% to 71,401 units, with related revenue adding about 37%. Group-wide, around 59% of turnover was generated in Europe, 28% in North America and 13% in the rest of the world.
But operating profit during the period increased by only a modest 4.3% to £83.1m, ameliorated by operating margin improving from 7% to 8%. This was based on plentiful profits for the motorcycle segment, 16.6% up, compensating for abject lack of profitability from bicycles. An excess inventory situation among bicycle dealers had led to a rash of discounting, which negatively impacted earnings. Pierer says the bicycle market as a whole is now characterised by major changes. Consolidation has already begun and will have profound effects on the entire pedal-pushing industry.
On a geographical basis, wholesale shipments of 76,767 motorcycles to European dealers were around 25% higher, while 59,212 bicycles shipped rose by 40%. However, almost 60% of the headline tally for motorcycles were sold in markets outside of Europe. North America predominated, with roughly 13% growth to 50,472, and India stacked on 81% to 33,029. Latin America, Asia and Africa declined.
On a brighter note, retail market shares for Pierer’s key KTM, Husqvarna and GasGas motorcycle brands strengthened despite a challenging economic climate in many parts of the world. Europe was relatively healthy, with overall registrations 11.1% up to around 470,000 bikes, featuring notable double-digit percentage advances in Germany, Italy, Spain and Austria. Pierer brands surpassed the success of competitors with a 20% registrations increase and market share lifting from 9.9% to 10.2%.
In North America, traditionally an important destination for Pierer, first-half total registrations flatlined on around 290,000 units. But it managed to grow year-on-year share in the US and Canada from 10.6% to 12.9%. Australia and New Zealand, meanwhile, copped a 4% decline of their total market, while the combined share for Pierer brands achieved a slight growth from 19% to 19.7%. And in India, Pierer’s strategic partner Bajaj Auto, sold more than 32,000 KTM and Husqvarna-branded bikes, raising its share from 4.1% to 5.7%.
Forecasts for the “new mobility” segment led by bicycles with or without electrical assistance have been downgraded. Pierer anticipates a shrinking market for the rest of 2023 and a difficult time in 2024. The company now says a target of €500m (about £430m) annual turnover from the sector, originally aiming for 2025, will take two more years to reach fruition.
€-£ currency translation at forex rates applicable on 29 August