Adventure Cycle Philippines, Inc. (ACPI), operated by Ayala Corporation, is ceasing its operations as the official Philippine distributor of KTM and Husqvarna starting October 1, 2024 eight years since they got the brand. The announcement was made on the brands’ respective social media channels.
Leading up to this, KTM AG, the holding company that owns both KTM and Husqvarna brands, and ACPI have “mutually agreed to pre-terminate the Importer Agreements.”
Starting October 1, 2024, KTM will be distributed in the country by Lucky MAPI—a part of the Motor Ace Philippines (MAPI) group. Lucky MAPI will also handle the marketing, sales, aftersales, and other operational activities relating to both KTM and Husqvarna.
Motor Ace is a long-time retailer of KTM as well as other motorcycle brands in the country.
Ayala was so bullish on the prospects of KTM in the country that it started assembling several KTM models at its Santa Rosa, Laguna plant which it operates as a joint-venture between the Ayala-owned AC Industrial Technology Holdings and KTM AG under KTM Asia Motorcycle Manufacturing, Inc. or KAMMI. The plant had a projected capacity of 10,000 units annually.
Starting with just four models—the 200 Duke, 390 Duke, RC 200 and RC 390, KAMMI expanded its manufacturing line to cover 13 models from the KTM group, including its higher displacement motorcycles and even the Husqvarna. At its height, it exported over 65 percent of its production to other Asian countries such as China, Thailand, and Vietnam.
By 2021, KAMMI hit a milestone by manufacturing close to 30,000 units. And by 2022, the local assembly of KTM motorcycle engines started.
Unfortunately, the success of KTM and Husqvarna was short-lived. A rapid slowdown in sales and increased competition from other motorcycle brands meant a lot of unsold inventories. This has led to brand-new KTM motorcycles being sold at huge discounts.
A quick check on the official KTM website reveals that KAMMI has been stricken out of KTM’s list of global manufacturing facilities. Currently, KTM only lists Austria, India, and China as its three global assembly plants. UPDATE: Ayala Corporation has confirmed that it will continue to produce KTM and Husqvarna motorcycles in Santa Rosa, Laguna still under KAMMI.
Ayala will also close its flagship KTM dealership located within the AC Motors Centrale in BGC.
This marks the second mobility brand Ayala lost in as many years. Aside from losing KTM and Husqvarna, it quietly discontinued the Chinese-brand Maxus. This leaves ACMobility with the distributorship of just three brands—BYD, Kia, and Volkswagen. It also operates dealerships of those brands as well as Honda and Isuzu.
This is why I don't put much stock in businesses being owned or backed by big name corporations, most especially conglomerates. They're usually the first ones to let go of non-performing businesses because they can easily write them off out of their balance sheets. I'd rather do business with small/medium-sized companies because they're much more heavily invested in the success of their respective businesses.
ReplyDeleteUly, in cases of closures like these, who will provide the aftersales services (ex. Maxus vehicles)?
ReplyDeleteLocal distributor of KTM is owned by Motor Ace of Borromeo Motoring Group who owns a lot of Motor Ace multibrand motorcycle dealerships,Mazda dealerships and Ford dealerships nationwide.
ReplyDeleteAyala AC Mobility earns a lot of money selling overpriced Kia vehicles now
The prices of BYD vehicles are controlled by the local representative of BYD that China sent to oversee and monitor the local operations of the brand
Volkswagen is still surprisingly alive as they're not pressured by VAG to sell more units as AC Mobility plans to turn the Volkswagen brand into a EV one in a year or two.
Can't say I'm surprised they went the same way as Maxus.
ReplyDeleteMaxus, VW, and it could be kia next
DeleteKey difference this time is that someone else will be taking over for said brands, which gives current owners a sigh of relief. Maxus owners have a Sword of Damocles hanging over them due to the uncertainty of the brand's future. Transparency is key, and Ayala has been less than forthcoming. It's a shame such an icon in Philippine business is being run this way.
DeleteMaxus closed down due to poor sales and SAIC Motor Philippines wants to sell Maxus vehicles rebadged as MG vehicles like the MG G50 Plus
DeleteVolkswagen ain't closing down as VAG given them very long term distribution contract
They changed their brand name to ac mobility that gives you something to understand this move......
ReplyDelete