KTM brochure – February 2019

KTM GROUP ACCELERATING TOWARDS THE ASIAN MARKET

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KTM GROUP

ACCELERATING TOWARDS THE ASIAN MARKET WITH SUPPLY CHAIN EXCELLENCE WRITTEN BY

LAURA MULLAN PRODUCED BY

CHARLOTTE CLARKE

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LUCA MARTIN, MANAGING DIRECTOR AT KTM ASIA MOTORCYCLE MANUFACTURING INC., REVEALS HOW THE FIRM IS READYING ITS SUPPLY CHAIN FOR ITS NEXT FRONTIER: ASIA

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f you’re a motorcycle enthusiast, KTM Group will be a company firmly on your radar.

Offering everything from trailblazing street

bikes to dirt-shredding motorcycles, KTM has earned its reputation as Europe’s largest motorbike manufacturer and now, on the road ahead, it has 04

its eyes firmly set on a new horizon: Asia.

One integral player at the heart of this expansion is Luca Martin, Managing Director at KTM Asia Motorcycle Manufacturing Inc. Martin is a seasoned professional when it comes to two-wheeled vehicles: he started his career as a mechanical engineer, specifically working on vehicle engine development where he used artificial intelligence (AI) to optimise mechanical components. His next career move saw him at Ducati. “I helped to create the complete supply chain of Ducati in Asia from scratch,” Martin recalls. “We had to find new suppliers, develop new components locally to optimise the factories out there.” This was no mean feat, but Martin helped to establish Ducati’s Asia presence and therefore when KTM Group readied itself to enter the Asian market, Martin was an ideal candidate for the job.

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“ WE STARTED PRODUCTION FOR BOTH LOCAL AND EXPORT MARKETS JUST OVER A YEAR AGO AND WE ARE ALREADY PRODUCING MORE THAN 7,000 UNITS A YEAR”

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— Luca Martin, Managing Director at KTM ASIA Motorcycle Manufacturing Inc

As part of this ambitious strategy, the company forged a US$2mn joint venture with Ayala Group’s offshoot Adventure Cycle Philippines Inc and a new subsidiary, KTM Asia Motorcycle Manufacturing Inc. (KAMMI), was born.

Today, the company produces bikes such as the KTM 200 Duke and RC 390 at its state-of-the-art manufacturing facility in Laguna, right in the heart of the Philippines, offering the perfect springboard for KTM Group to enter Asia. “We started production for both local and export markets just over a year ago and we are already producing more than 7,000 units a year,” enthuses Martin. “We have big hopes for the Southeast Asian market.”

Tackling a new location is a challenge for any firm, but with its strong local partnerships, KTM Group has been able to hit the ground running. “Thanks to Ayala’s support, we’ve been able to start production in a very short time: we’ve been able to move from a startup to a scaleup company,” Martin observes. “They really helped us establish strong relationships with local suppliers and this is one of the key advantages of setting up this joint

CLICK TO WATCH : ‘KTM FACTORY RACING 2019 DAKAR RALLY REVIEW | KTM’ 07 venture.” As one of the largest and

suppliers are used to working in the

most diversified business groups in the

automotive segment and they’re used

Philippines, Ayala Corporation is

to helping manufacture millions of cars

present in markets including real

every year. Our challenge is to help the

estate, banking, telecommunications,

supplier understand that by working

water, power, industrial technologies

with a well-known brand, there’s more

and more. This has allowed KTM

opportunity to grow. In the long term,

Group to gain a deep understanding of

we hope to increase our more and

the Philippine market.

more bikes.” In doing so, KTM Group is

Entering this new market was a

not only helping to meet the burgeon-

challenge from a supply chain per-

ing demand for its motorbikes, it’s also

spective as it meant developing a new

helping to boost the local economy

network from scratch. However, this is

and generate employment for more

a challenge that KTM Group has taken

Filipinos. “Many of our suppliers are

head on. “Many Asian companies and

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(SMEs),” explains Martin. “By working

working with some partners in Asia to

with us, they get the chance to grow

develop a supplier rating platform

not only in terms of revenue, but also in

where each and every supplier can log

terms of qualities and process.”

in, create a profile and get feedback

Always keen to race ahead, KTM

about their performances. I think this

Group has also sought to digitalise its

digital approach is important for the

supply chain. “We’re finding new ways

future of procurement.” Data is

to get in contact with suppliers,” Martin

probably one of the most powerful

says. “In the past, we used to get

tools that supply chain professionals

hundreds of emails every day with

have today, however whilst technology

different company profiles and most of

is set to disrupt the sector for good,

the time I simply didn’t really have the

Martin affirms that a human approach

time to physically go through all these

is also vital. “If we want to build a very

potential prospects. Now we are

strong relationship with suppliers, I

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E XE CU T I VE PRO FI LE

Luca Martin Turnaround CEO with 10+ years of experience in the automotive business. Developing high-quality business strategies and plans ensuring their alignment with short-term and long-term objectives. Leading and motivating directors to advance employee engagement, developing a high performing managerial team. Setup of operational and financial goals, informing and advising Board members, managing the organization’s resources, promoting the enterprise to its stakeholders, recommending a proper budget, with an emphasis on cost savings. Start-up approach on new operations.

Business angel and startup mentor/investor.

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1953

Year founded

â‚Ź1.14bn Approximate revenue 2016

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HQ

Mattighofen Austria

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Twice the power, Twice the possibilities

LEARN MORE

www.vpic-group.com | pndat@vpic-group.com

CLICK TO WATCH : ‘THE JOURNEY OF A LEGENDARY BRAND HUSQVARNA MOTORCYCLES’ 13 think it’s important that we visit them.

We need to create a face-to-face relationship,” he asserts, “but at the same time, I think that digital platforms can help buyers be more productive because they can count on reliable data to select suppliers.”

As well as developing a new supply chain, KTM Group also had to contend with the challenge of getting the right talent and expertise on board, however when your brand is one associated

“ THANKS TO AYALA GROUP’S SUPPORT, WE’VE BEEN ABLE TO START PRODUCTION IN A VERY SHORT TIME: WE’VE BEEN ABLE TO MOVE FROM A STARTUP TO A SCALEUP COMPANY” — Luca Martin, Managing Director at KTM ASIA Motorcycle Manufacturing Inc

with adrenaline and speed it seems that finding employees who are passionate about the product isn’t too w w w.k t mgrou p . com

Proud to be part of.

Creating value for all.

Creating value by combining the power of innovation and product quality and passionately creating world class solutions catering to two wheeler, passenger cars, commercial vehicles, construction and agricultural machines and rolling stocks.

Visit us at: motherson.com

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wiring harness rearview mirrors moulded plastic parts and assemblies injection moulding tools moulded and extruded rubber components modules and systems machined metal products cutting tools aluminium die casted products sheet metal parts thin film coating metals IT services wireless power hot stamped parts

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KTM Engine Factory in Mattighofen

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difficult. “We’re lucky that we produce a product which you could call an entertainment product so you can tell talent, ‘Look, if you are passionate for the motorcycles, we are producing one of the best that you can find in the market’,” says Martin. “This is a very valuable retention tool. A lot of KTM employees are passionate about motorcycles or are even professional riders. On the other hand, we do believe that this isn’t the only thing we offer. We also try and onboard local

“ KTM GROUP HAS RECORDED RECORD VOLUME PRODUCTION EIGHT YEARS IN A ROW” — Luca Martin, Managing Director at KTM ASIA Motorcycle Manufacturing Inc

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“ IF WE WANT TO BE SUCCESSFUL ABROAD, WE NEED LOCAL TALENT”

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tion, the Asian market will play a key role in its future growth strategy. “KTM Group has recorded record volume production eight years in a row. Every year we’re producing more and more bikes and in 2018, we saw a total sales increase of about 10% to 261,000

— Luca Martin, Managing Director at KTM ASIA Motorcycle Manufacturing Inc

well-known brands for off-road in

people who believe in our values. If we

equipment manufacturers) but the

want to be successful abroad, we need

future growth of KTM Group cannot

local talent because only they can help

be as strong without Asia.”

KTM better understand the local culture.”

The Philippine plant is KTM Group’s

motorcycles. KTM is one of the most North America and in Europe we are now one of the biggest OEMs (original

KTM Group’s reputation precedes it.

To disrupt the Asian market KTM Group

third manufacturing facility, with its first

will undoubtedly rely in on its race-

located in its home country of Austria

proven success. Its distinctive orange

and the second in India. In selecting

motorcycles have crossed the winning

Asia as a key market, Martin contends

line at 18 Dakar Rallies in a row and

that as the group ramps up its produc-

KTM racers have gained 281 world

KTM Board of Directors

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CO MPAN Y FACT S

• 281 world championship titles up until now • 18 consecutive wins at the Dakar Rally • Europe’s biggest motorcycle manufacturer • Total sales 2018 increase of about 10% to 261,500 motorcycles

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“ WE TRY TO TRANSFER WHAT WE’VE LEARNT FROM OFFROAD IN TERMS OF PRODUCT QUALITY AND EASE OF MAINTENANCE AND BRING THAT TO OUR STREET BIKES. WE ALWAYS WANT TO BE ON TOP OF TECHNOLOGY” — Luca Martin, Managing Director at KTM ASIA Motorcycle Manufacturing Inc

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championship titles up into now. Martin wants to bring this same world class quality to Asia. “We want to show the Asian market that KTM represents

We always want to be always on top of

quality and more importantly, we’re

technology.” KTM Group has also

ready to race. We want to bring this

shrewdly kept track of emerging trends

racing spirit to Asia and we truly believe

in the motorcycle space. For instance,

there will be a bright future for big bikes

whilst the firm noticed a dip in demand

in this market.” The firm won’t just rely

for superbikes they tapped into the

on its legacy though: it’s keen to invest

growing uptick for smaller bikes.

in new innovation so that it can create

“This was a strong move by KTM,”

the best race machines in the market.

notes Martin. “We focused on smaller

“One of our biggest competitive

displacement bikes but our competi-

advantages is that we try to transfer

tors didn’t.”

what we’ve learnt from offroad in terms

Just as consumer demands are

of product quality and ease of mainte-

shaking up the market, the rise of

nance and bring that to our street bikes.

electrification could always change the

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motorcycle market for good. “We are

a challenge but with the right partner

now in an era of new mobility,” Martin

we will be able to prepare for this shift.”

asserts. “We truly believe that sooner

Looking ahead, the future is bright

or later they will be a move to electric

for KTM Group. The firm has cemented

motorcycles. We have been developing

its position as Europe’s largest

off-road electric bikes for many years

motorbike manufacturer, and now

already. We’re seeing a shift in that

Asia’s motorheads need to look no

direction and we want to be part of this

further if they want to get their hands

movement.” This market swing won’t

on a high-quality race machine.

come without its challenges though.

Whilst the weight of a battery may only slightly alter the performance of a car, it can “completely change the handling of a bike”, according to Martin. “This is w w w.k t mgrou p . com

KTM Group Stallhofnerstrasse 3 5230 Mattighofen Austria T +43 7742 60 00 www.ktmgroup.com