Pierer Mobility purchases stake in MV Agusta, secures distribution deal with CFMOTO

Common Tread recently reported on Pierer’s deal with MV Agusta, in which KTM’s North American dealerships would handle distribution for MV’s range of exotic motorcycles. Not even two months later, KTM is making a serious investment in MV Agusta and expanding its partnership with Chinese manufacturer CFMOTO. Pierer’s portfolio of brands is bigger than ever, and the Austrian giant shows no signs of slowing down.

If you're not familiar with the Pierer Mobility name, you do know some of its brands, such as Husqvarna, GasGas, and Felt bicycles, in addition to the crown jewel of KTM.

Pierer’s partial ownership of MV Agusta 

Pierer Mobility now holds a 25.1% stake in MV Agusta after a recent capital increase and global distribution agreement. Pierer/KTM will support MV with technical support, supply chain logistics, and a global network of dealerships in return for the quarter stake. The move may bring some stability to MV Agusta’s long history of financial trouble, including Harley-Davidson’s painful 2010 fire sale to Castiglioni and a near-closure in 2015. Access to Pierer’s economies of scale could help the Italian marque with moving forward and updating some tired engine designs. (Though now a few years old, Mark Gardiner’s interview with past MV Agusta CEO Giovanni Castiglioni lays out a lot of the company's tangled history and modern-day challenges.)

When news broke of KTM’s U.S. distribution deal with MV Agusta, it wasn’t hard to imagine an eventual acquisition despite MV’s relatively low production numbers and limited dealer network. Now that Pierer has a sizable stake in MV, rumors are already circulating about possibilities like Pierer Mobility buying MV Agusta outright and the return of MV Agusta to MotoGP racing. The latter possibility might seem like a long shot, but who ever expected to see GasGas on the MotoGP grid for 2023?

The KTM-CFMOTO partnership

Compared to the recent dealings with MV Agusta, Pierer/KTM and CFMOTO have a much more established relationship. The brands first joined forces in 2013 in a joint venture company called CFMOTO-KTMR2R. KTM benefitted from CFMOTO’s production capabilities, and in return, CFMOTO used KTM platforms under license (most notably the LC8 V-twin) to build some of the most powerful motorcycles of any Chinese manufacturer. CFMOTO also built bikes for KTM, which were mostly smaller models for sale in the enormous Chinese domestic market.

Under a new agreement, KTM has acquired distribution rights for CFMOTO motorcycles in the United Kingdom and Ireland from a company called Quadzilla (no relation), which dropped two-wheelers to focus on selling CFMOTO’s popular four-wheeled products like ATVs, UTVs, and side-by-sides. KTM will take over starting January 1, 2023. A new CFMOTO naked concept is making the rounds before EICMA, and it is supposedly powered by KTM’s old 790 twin, so there probably isn’t a better partner to sell and service the CFMOTO line in Europe. Pierer may try to secure distribution deals for other European countries in the near future.

In the United States, CFMOTO’s presence has been focused on the ATV/UTV side of the business, although its motorcycle offerings took a big leap forward in recent years. Brandon checked out seven models earlier this year if you’d like to learn more about CFMOTO’s current lineup. CFMOTO USA, based in Plymouth, Minnesota, is the current U.S. distributor, and neither manufacturer has mentioned any change to that arrangement.

The bigger picture for Pierer

Both deals are standard stuff out of the Pierer playbook. MV Agusta is getting the “acquirable famous brand” treatment with increasing investments during a pivotal time for the company. Pierer bought KTM when it was nearly worthless, salvaged Husqvarna from BMW’s fumbling, and picked up GasGas after severe financial trouble. Expect Pierer to continue easing into a position of control unless it sees a compelling reason to abandon the idea.

As for CFMOTO, Pierer has a history of partnering with regional powerhouses for global expansion. Consider KTM’s 2012-present partnership with Bajaj Auto in India, where 125, 200, 250, and 390 models are built for sale around the world. In exchange, Bajaj gets access to KTM’s engine tech for its own motorcycles, like the Duke 390-based Dominar 400. Bajaj also bought a stake in Pierer, and the two seem happy to scratch each other's backs as demand for their products stays strong. The CFMOTO tie-up sounds like more of the same, but with a focus on middleweight and large motorcycles.

Pierer's aggressive expansion efforts seem to be paying off. Last year, its brands sold 332,881 motorcycles — an increase of 23% over the previous year. If Pierer can weather the financial uncertainty of the next few years, it could emerge with a fairly long list of brands and products under its orange umbrella.