INSIDE THE HUSQVARNA MERGER: WHAT’S NEXT FOR THE ICONIC BRAND AND IT’S NEW OWNERS
KTM North America President Jon-Erik Burleson with Roger DeCoster.
SOURCE: MOTOCROSS ACTION
KTM’s Jon-Erik Burleson and Werner Kastenauer recently talked about KTM’s plans for the immediate future of Husqvarna in the in-house “Husqvarna Motorcycle Journal” newsletter. Here is the what they said.
It’s the question that has been on everyone’s lips after the sale of Husqvarna to Pierer Industry AG. We’re getting close to having answers to all the burning questions, but the first order of business – and one Husqvarna and KTM are still in the midst of – is getting through the transition period. People like KTM North America’s CFO Werner Kastenauer and president Jon-Erik Burleson have been charged with the task of ensuring the U.S. transition is a smooth one, and both have been working diligently behind the scenes so that business has not – and will not – be interrupted during the ownership change.
KTM race team manager Pit Beier has the KTM team all sewn up for 2014, so he has turned his attention to the new Husqvarna Grand Prix motocross team for 2014. Plus, there will be an American offroad team.
As they near the tail end of the initial transition period, Kastenauer and Burleson shed some light on the critical steps being taken at the core of Husqvarna’s transition, and talk about what changes have already taken place, what is yet to be decided and what we can rest assured will not change.
“WHO WILL THE NEW PRESIDENT BE? WHERE WILL THE HEADQUARTERS BE? WHAT WILL THE NEW MODEL LINE LOOK LIKE?” IT MAY SEEM LIKE NOT MUCH HAS HAPPENED YET. BUT FROM THE INSIDE, A LOT HAS ALREADY TAKEN PLACE.
To those on the outside awaiting answers to questions such as, “Who will the new president be? Where will the headquarters be? What will the new model line look like?” it may seem like not much has happened yet. But from the inside, a lot has already taken place. There are many bodies working diligently behind the scenes to usher the Husqvarna transition along, foremost being KTM’s Werner Kastenauer, who has been on the job since day one.
The collateral damage of the KTM/Husqvarna merge is Husaberg. It will be folded into Husqvarna, which is kind of fitting, since it was a spin-off from Husky when they were sold to the Italians decades ago.
“A lot has already taken place,” Kastenauer said. “We’ve been handed a lot in such a short period of time. The first phase of our transition back in February was to make sure the guys at the Husqvarna Motorcycles North America office were able to come to the office, open the doors, power up the computers and get emails. We had to make everything work within a two-week period of time so we could keep the shop alive.
Romain Febvre will most likely be signed to race for the all-new Husqvarna team in the 250 GPs. He currently races for the Jacky Martens KTM team (and Martens has been given control of the 2014 Husky team, while the 450 team will be handed over to Kimi Raikonnen’s ICEone team).
“We then knew that we needed to send a strong signal to the dealer network to show that the Husqvarna brand is alive – and that’s what we did when we launched the Spring Fever sales promotion. That has helped the dealers, and helped the consumer see that there should be confidence in the brand, that we are here and things are moving forward.
“THE THIRD STEP RIGHT NOW IS WE ARE MOVING EVERYTHING FROM A BMW INFRASTRUCTURE TO AN INDEPENDENT HUSQVARNA INFRASTRUCTURE…”
“The third step right now is we are moving everything from a BMW infrastructure to an independent Husqvarna infrastructure meaning we are moving the parts center, we’re moving all the parts, we’re moving the bikes so we can ship and provide these items out of the KTM infrastructure at the moment.”
Husqvarna’s interim reliance on KTM infrastructure is a necessary step, as Burleson pointed out, “You can’t really look at Husqvarna North America as a true standalone subsidiary with its own distribution center and its own accounting center because all of that was provided by BMW. In order to make business work on day one without BMW, yeah, we’re going to have to step in.”
KTM wants to utilize as many pure Husqvarna parts as possible, while weeding out the BMW items. The TC250 engine is the newest motocross engine in the previous Husky lineup.
It is logical enough to assume that manufacturers under common ownership will share a number of resources, but Burleson clarified some specifics on how exactly Husqvarna will retain its autonomy from KTM in North America.
“WE WILL DRIFT AWAY FROM THE BMW-INFLUENCED PRODUCT DESIGNS – IT’S ONLY LOGICAL. BUT ARE WE GOING TO SUPPORT THEM THROUGHOUT THE USEFUL LIFE THAT A CONSUMER HAS? ABSOLUTELY.”
“Customer service, racing and marketing – those are the three most important to have separate from an internal staff perspective. It also makes good business sense to have a separate sales staff and a separate dealer network. We may be doing some hybrid approaches to the salesmanship that would be aimed at just being easy to do business with from a dealer perspective. But when you talk about racing and marketing and customer service, that’s gotta be standalone.”
Yet to be answered is how much of the Husqvarna flavor will remain in the 2015 lineup, versus how many KTM parts. It should be noted that over time, Husaberg went from a unique product to a KTM clone. The price structure benefits from as much parts sharing as feasible in terms of wheels, brakes, suspension components, levers, sprocket and other easily translated parts.
Once the transition period is complete, the new chapter will be well on its way. Husqvarna is cleaning the slate by offering incredibly low prices on remaining inventory, but that shouldn’t suggest that the brand is planning to clear out parts and support for existing models.
“For sure there will be support,” Jon-Erik said. “The current product isn’t going to be something that’s shelved and put out of life. That’s not a fair way to look at it. We will drift away from the BMW-influenced product designs – it’s only logical. But are we going to support them throughout the useful life that a consumer has? Absolutely.”
This particular initiative has also kept people like Kastenauer quite busy behind the scenes, or as Burleson puts it, “at an overload capacity” focused on making sure systems work, spare parts have been delivered and motorcycles get shipped.
“WE ARE 100% DEDICATED TO SUPPORTING THE CURRENT HUSQVARNA LINEUP AS WELL AS ALL THE BIKES THAT ARE IN THE FIELD,”
“We are 100% dedicated to supporting the current Husqvarna lineup as well as all the bikes that are in the field,” Kastenauer commented. “There will be technical expertise and we will fully support the whole lineup with spare parts and accessories.”
If MXA wanted to bet, we think that Pit Beier would be looking at former KTM rider (and current Pro Circuit 450 rider), Tyla Rattray for a spot on the new Husky 450 team.
As for the big announcements the outside world is still waiting for, Kastenauer talked about how soon we might expect to hear. “We are pretty close to making some official announcements. For now we just want to make sure that we can give the customer and dealers support they need. In a second step we will think about our organization structure, who is in charge of what and logistics of where the headquarters is going to be.”