~ Auto Buzz ~: ON THE RECORD: Hubert Trunkenpolz Unplugged: KTM’s Chief Sales Officer/Director speaks candidly about the company’s business.

The United States is the single biggest market for KTM, and the most important one. Europe is more street-oriented, but we still sell more dirtbikes than streetbikes in America. We have reached a market share of almost 80 percent in the off-road competition segment—not motocross but enduro—so there is limited space to grow off-road. Thus it was a logical step for us to go step by step deeper into the much bigger streetbike segment, and the first really successful bike was the Adventure 990. We took into consideration Americans’ riding behavior: They want to go longer distances; therefore you need a bigger fuel tank and more long-distance ability. And of course we had the American market in mind when we made the step from the Super Duke R to the GT. The typical off-road bike buyer is a blue-collar worker. This is a guy who spends his leisure time competing in amateur motocross or enduro racing. With streetbikes we are definitely targeting a premium customer because our bikes are, price-wise, on the level of a BMW or a Ducati. But you get a lot for your money because the bikes that we build are the most powerful in their class. And quality-wise, of course, they’re on the same level as a BMW.

Our customer is performance-driven and looking for a different kind of motorcycle. Take a look at our Super Adventure: 150 horsepower for a “trailie” really makes a statement! You can’t be performance-driven with 60 horsepower, like a Harley. A lot of our customers are experienced riders and they are able to ride a Super Duke on the edge. We doubled our market share in the three years after the economic crisis of 2007-2008. In Europe we went from 5 to 10 percent, and in the U.S. from less than 3 to more than 5 percent. We had the right products available and gained a lot of ground. But it was tough: I was in Temecula [at KTM USA] and we had so many buybacks from GE [the company that finances dealer flooring] that we had negative turnover. These bikes came back to us as living spare parts. But the Americans handled it well; they didn’t give up, they just pushed through. This gave us a lot of motivation and inspiration. When you look at the curve, the U.S. fell down rapidly but the bounceback was quite fast. In Europe it was slower dying and very, very slow to recover. Currently we have four factories around the globe where we do Complete Knockdown Kits (CKD): one in Colombia, one in Brazil, one in Argentina, one in Malaysia and another one in consideration for Southeast Asia. This effort is always to avoid high import taxes, and in Brazil it’s also to create jobs—among Honda, Yamaha, Suzuki, BMW and KTM, we have created almost 100,000 jobs in Manaus. Brazil is by far the biggest economy in South America—double the size of the European market; bigger than Europe and America together—and if you would like to participate, you have to play the game.

One of the keys to KTM’s success is really clear positioning of the brand. But it also has some limitations because there are some products in segments that you cannot do because you soften it up. I think our customers would not forgive us for that. We considered changing “Ready to Race” to “Are You Ready?” and it was a shit storm! Husqvarna can go into segments that KTM cannot. But even with the “retro” models, we have modern technology. It’s not like we went down in the cellar to pull up an old engine and chassis and put it all together into a motorcycle. That’s not the direction we want to go with Husqvarna. We see much more future-oriented concepts. MERGING HUSQVARNA WITH HUSABERG WAS A LOGICAL STEP to integrate it into KTM. Also, there were some dealer conflicts behind it, a lot of legal implications in the distribution network, and it was much easier to solve in this way. Utilizing the platform strategies was another reason to do it. But we still have the Husaberg brand in our pocket.

BMW asked the car guys how to handle Husqvarna, in my opinion. And the car market and the motorcycle market are completely different. The Mini guys had no clue! [Relaunching Husqvarna] was, for us, a little bit like moving a mountain, the effort behind it. But using the same platform [as the equivalent KTM models] was the key to not losing years in the market developing all-new models. All motorcycle manufacturers have one problem, and that’s getting young people attracted to motorcycles. Our way is to provide beginner’s bikes, which not only look like a real high-performance motorcycle, but also have some of the same features. Normally a 16-year-old doesn’t pay for a bike by himself; he has some help from his mom or dad, grandmother or grandfather. He has to convince them first to let him have a motorcycle anyway, and ABS is a must. Even a mother knows what it is! Also, for us, we want to keep this customer, and keep him alive. Safety is not only in electronic devices like ABS. It’s also good suspension and an engine that delivers enough torque and power to give you a safe ride. All of these features must be available in a beginner’s motorcycle. It’s how you convince people that two wheels are a good option.