KTM sees lower output for motorcycles this year

MANILA, Philippines — The joint-venture between AC Industrial Technology Holdings Inc. of the Ayala Group and KTM AG expects its motorcycle output to decline by 21 percent this year from a year ago amid supply chain issues, but the firm is hopeful of seeing improvements in the second half.

KTM Asia Motorcycle Manufacturing Inc. (KAMMI) president Andre Angelo Santos told reporters the company is aiming to produce around 11,000 motorcycles at its plant in Laguna this year, down from the 14,000 units last year.

“The world is going through a lot of supply chain issues. Supply chain issues have hampered a lot of industries and the vehicle industry is not spared with that,” he said.

He said there have been some improvements, however,  with many parts needed for assembly operations now coming in.

“This is good news because we still have another half of the year to be able to perform,” he said.

Earlier this year, KAMMI inaugurated a facility for building engines for its motorcycles, a move undertaken to manage supply chain issues.

Previously, KAMMI was sourcing engines for its motorcycles from India.

Santos said building engines locally has enabled the firm to increase the local content of its motorcycles to more than 40 percent.

KAMMI manufactures 13 models at its plant in Laguna, with the motorcycles sold locally and exported to China and Southeast Asian countries.

Santos said there has been some delay in exports to China due to pandemic-induced lockdowns, but the company is hopeful it would start to pick up as restrictions are eased.

Despite rising fuel prices, he said the company still sees opportunity in catering to those looking for other means of mobility.

“That’s the space where I think we can perform, by providing them with a very good motorcycle that is made by the Filipino for the Filipino,” he said.