Ktm Case Study
Group 1: Kristina Misha Vladislava Adamenková Alina Schön Miro Verdel
KTM Sportmotorcycle AG is an Austrian motorcycle, bicycle and moped manufacturer. The company was founded in 1934 by engineer Hans Trunkenpolz in Mattighofen. It started out as a metal working shop named “Kraftfahrzeuge Trunkenpolz Mattighofen” and in 1954 the company began producing motorcycles. KTM, primarily a producer of premium off-road sports motorcycles, has been the fastest growing major motorcycle manufacturer for the past three years with a cumulative average growth rate from 1998-2001 of 31% in revenues and 50% in profits. Its improved financial performance enabled the company to pay down long-term …show more content…
Brand position and image (“ready to race”; focused, uncompromising and extreme)
The strong brand of the company is gained mainly through its racing success and the reliable and high quality products. The vast majority of the products are either in the extreme segment or hybrid between on-road and extreme. That is a clear strategy that is easy to remember by the customer.
70% of the sales are off-road bikes. Their customers accept regular repairs as part of owing an off road motorcycle. KTM has 50% margin on the spare parts and only 15-16 percent margin on the whole bike. That way it increases its profitability. Off-road bikes are the fastest growing segment. They have a short average life span because of quick introduction of new models and upgrades. Not only do customers agree to repair them often enough, they also agree to buy a new one every now and then. That of course increases the profitability tremendously and that is happening due to the strong brand position.
Intimate contact and flexibility with its dealers
When KTM was small enough it has built very strong relationships with its dealers. KTM allocated and placed close to 90% of its production in the