MotoGP News: Situation At KTM Worsens After Company Backtracks On Salary Commitments

Saajan Jogia | Dec 14, 2024

Apr 12, 2024; Austin, TX, USA; Brad Binder (33) of South Africa and Red Bull KTM Factory Racing during practice for the MotoGP Grand Prix of the Americas at Circuit of The Americas. Mandatory Credit: Jerome Miron-Imagn Images / Jerome Miron-Imagn Images

KTM's financial situation appears to have deteriorated, as reports suggest the company has backtracked on its commitment to pay its employees before 2025. The Upper Austrian Chamber of Labour revealed that KTM staff will not receive their December salary, despite the company's earlier promise to provide a 90 percent advance on the month’s pay.

The difficult situation arises amid financial challenges faced by KTM's parent company, Pierer Mobility Group (PMG), which is currently undergoing insolvency proceedings. While KTM's MotoGP project has so far remained unaffected, KTM's failure to pay staff their salaries paints a grimmer picture than initially anticipated. Stating that KTM has backtracked on its promises, the Upper Austrian Chamber of Labour said in a statement:

“Before Christmas, KTM wanted to transfer a 90 percent advance of December wages and salaries to the employees.

“This had been assured to the employees. However, nothing will come of it now!

“The insolvent company from Mattighofen is apparently unable to carry out the promised transfers.”

Upper Austrian Chamber of Labour's president, Andreas Stangl added:

“Now the November wages and salaries as well as the Christmas bonus have not been paid. And now, shortly before Christmas, this news!

“There is simply no more handshake quality in the management of KTM.

“We as the Chamber of Labour will definitely do everything we can to ensure that employees receive their outstanding claims via the insolvency remuneration fund as quickly as possible.”

The chairmen of the PRO-GE and GPA unions, Reinhold Binder and Barbara Tieber revealed that KTM failing to pay salaries before Christmas despite the assurance is like a "slap in the face" of the employees. The duo adopted a firm stance on the issue, emphasizing the importance of identifying those responsible for the current situation. They said in a joint statement:

“The fact that, contrary to the company's promises, the outstanding wages and salaries will not be paid out before Christmas is like a slap in the face of those affected.

“They are now paying the bill for apparently misguided management decisions.

“It will certainly still have to be examined in detail how such a dramatic situation could have come about and who is responsible for it.

“We will now do everything we can to ensure that employees quickly receive their claims from the insolvency remuneration fund and will accompany them through these difficult days and weeks.

“The example of the KTM insolvency shows once again how important this fund, which is financed from the so-called non-wage labour costs, is for affected employees.”