Tough Questions for KTM

If you haven’t realized by now that KTM is deeply committed to ATV racing you’re probably just now wondering into the sport. Unlike most manufacturers, KTM’s very first product in the ATV marketplace was a no-holds-barred-made-specifically-for-racing quad.

In order to produce a machine that’s made specifically for racing applications the cost of owning a KTM is understandably higher than other brands. If it were five years ago buyers probably wouldn’t think twice about purchasing the highest priced ATV in the sport segment, but now days dealers are having a hard time moving anything from their showroom floors, much less their top shelf products. People just aren’t buying like they used to.

KTM hit the ATV marketplace right when Americans entered what I’ll call our frugal-era, opposed to the spend-happy times a few years prior, so I have to assume the company missed out on a lot of momentum that could have carried them through these hard times.

In an effort to understand how KTM is dealing with lackluster sales during this frugal-era I talked with KTM’s ATV Brand Manager, Chris Vogtman and fired some not-so-ordinary questions at him.

Beyond being in the know at KTM, Chris has a very good feel for the ATV industry. He’s been an avid quad rider and enthusiast for nearly twenty years. And before his KTM position he was the Managing Editor at ATV Sport Magazine.

First off congrats to you KTM on building two outstanding quads with the XC and SX, and to you for landing the Brand Manager role.
Thanks. And, congratulations to you too on the new ATV Scene. I know I’ve missed the site, and your fresh digs are a new industry standard for ATV news! You’ve always wore your heart on your sleeve when it comes to ATVs, and the dedication you put into this site proves it.

Thank you so much for saying that. I think the new site will allow our tenth year to be the best yet. While we’re congratulating each other, I gotta give it up to you for how far you’ve come in this industry too buddy. Newspaper guy to magazine guy to KTM Brand Manager, impressive my brother!
Thank you. What a wild ride. These last seven years have flown by,

I have some gloomy questions I have to ask you about KTM, but before I hit you up with that nonsense I have to ask how my pals Tim Farr and John Maley are doing at KTM? Like you, I’m really proud of all they’ve accomplished in their careers and the impact they’ve had on the success of the KTM ATV.
Absolutely! Having Tim Farr’s input has been great for KTM. Most know Farr was a great racer, (he’s going to kill me for saying WAS because he can still haul the mail), but trust me, he’s an even better engineer. Add his 10-plus National championships and ATV knowledge with our team of dedicated Austrian engineers who strive for absolute perfection, and our R&D technician John Maley in the mix and you have a recipe for success.

Okay, sorry to do this to you but on to the doom and gloom. There’s no doubt KTM has done an exceptional job in mass producing one of the best machines money can buy, but now days people just don’t have money to spend like they used to. What’s a manufacturer to do? Is there any chance we’ll see KTM getting out of the ATV business?
Honestly, the Great Recession has put everybody in a tough spot, not just us. The powersports industry has been absolutely hammered. Every OEM has had to make considerable cutbacks, tighten the belt and make tough decisions to ensure they are still viable down the road. It’s not that racers and enthusiasts don’t want to buy. Part of it is they can’t sell what they already have for a fair price. But truly that’s onl
y a small fraction of the bigger issues at play. Many racers and riders work in the manufacturing and construction trades, and they’ve been hit really hard by the housing collapse and economy. What does that mean for KTM? To us it means it’s not a time to sit idle and hope things get better. For 2010, we’ve offered more racer support, announced double contingencies for 13 race series and created an ATV only Orange Brigade program that proves we’re serious about ATVs for 2010 and beyond. So no, we’re certainly not getting out of the ATV business, that’s for sure.

Amazing, I would think the right approach would be to just hang in there and not spend. Speaking of spending, KTM recently added a pretty impressive building to KTM America headquarters in Amherst, Ohio, AND moved key personnel to the Murrieta, CA office. It appears to me there’s more spending and lots of changes going on here too.
Our new facility in Ohio is definitely state-of-the-art and helps service our customers better and more efficiently. GNCC racers who stay for the Sunday races know that our dirt bike product is full-on and there’s literally a sea of Orange at the GNCCs, National Enduros and hare scrambles. To me that proves we’re headed in the right direction and investing in our infrastructure is needed. Moving our dealer development, marketing and race teams to California was certainly a strategic move that puts us in the heart of the industry. If there’s one key thing I can say about KTM, it’s that we won’t sit and wait for something to happen. Bad economy or good, we’re always striving to improve our business and product to make our customer’s experiences better.

I saw a dealership in PA selling new never-ridden ’08 450XC units for just $5400. That has to be way below dealer cost. What’s going on here?
Like many OEMs, we’ve offered retail financing and retail programs to help dealers move inventory. We can only set MSRP; it’s up to the dealer to decide what price to sell the unit at. They must have been in a hurry to move some units.

I would think KTM would do quite well with an affordable entry level ATV like Yamaha’s Raptor 250. Are there any plans in the works for a machine like this?
First off, we want to applaud Yamaha for its Raptor 250. We’ve had the opportunity to put the Raptor 250 through its paces. It’s a good entry-level sport ATV that fills the crucial Y12 age-specific niche well. As you know, we have a really strong 250 SX-F dirt bike motor, so I wouldn’t rule it out.

That’s right were I was going with that question. ATV Scene.com was able to score an enormous scoop back in 2007 when we interviewed Adam Clark about the then top secret KTM quad project. Is history going to repeat itself here?
[Laughing] No comment

Let’s break away from all the tough questions for a minute. When did you start riding? And what was your first ATV?
Let’s see I got started back in 1993, rolling on a Honda Fourtrax 300.

How did you get your start in the ATV industry?
I always had a riding background, and saw a job opening at ATV Sport. I applied, somehow got the job with newspaper experience under my belt and the rest is history.

So how do you like California life compared to Minnesota and Ohio?
SoCal has its benefits, but affordability sure isn’t one of them. To register a 2001 F150 it cost me $425 just for tags. In Ohio, it was $35. That was a shock when I moved here a year-and-a-half ago. I miss the seasons in Minnesota and Ohio, but I hear it’s been a long snowy and cold winter. So, come to think of it, maybe I don’t really miss it all that much. In SoCal, every day is a riding day. You actually start to take it for granted.

I was talking with Wes Miller and Harold Goodman. Both think if a manufacturer were to release a lightweight 450 with independent rear suspension everyone would switch to IRS. Wes even went as far as saying straight axle racing would be viewed like 3-wheeler racing is now by the end of this decade. What’s your opinion on this?
[Laughing] That sounds like a challenge! In all honesty, a lightweight IRS sport ATV that could actually be competitive against straight axles in all racing disciplines seems a long ways off. Our engineering team has had the opportunity to spend considerable time on competitive IRS machines from other OEMs. Ultimately the problem with IRS always comes back to unsprung weight at race speeds. Will I be eating my words in two or three years? Innovation is a good thing so I hope so, but due to it being cost prohibitive and unproven, I don’t see it happening.

I agree with you, but I hope Wes is right and we eat our words in a few years. Speaking of creating new equipment. Do you think alternative energy equipped ATVs and UTVs are in the sport’s future? Do you see an electric powered KTM in our near future?
Alternative energy is certainly intriguing for KTM. Being a European company, land-use and noise issues are even more prevalent across the pond. That’s why we’ve invested considerably in the emerging battery technology and unveiled a true off-road electric dirt bike this past fall. I can’t comment on if that will transfer to future ATV or even side-by-side products for KTM, but what I can tell you is the dirt bike is pretty trick!

Now that you brought it up you don’t think I’m going to let that the words side-by-side come out of your mouth without hitting you up on that front do you? Will we see a KTM SxS in the near future? Does KTM watch this segment? Is there any interest in it at all?
It’s certainly something we’ve looked in to and we do have the capability to produce a side-by-side at a high level. We do produce a high-performance X-Bow car after all, so we definitely have the technology to make more than just ATVs with four wheels [Laughing]. In all seriousness, we’re intrigued by the side-by-side market, but it’s not a product we’re willing to take a risk on right now in this economy. We know a few other OEMs are set to launch their versions of side-by-sides, and it will be interesting to see what impact that has on the side-by-side business.

 

You mentioned earlier that KTM has doubled ATV contingencies. Can you talk more on this?
Racing is something we really take pride in here at KTM. With a slogan that says “Ready to Race”, it’s pretty obvious how important racing is to us as a company. And, it’s not because of the business aspect. At KTM, we’re all racers and riders. The president of KTM Nort
h America, Jon-Erik Burleson, is the son of legendary National Enduro dirt bike racer Dick Burleson, so racing is in the blood. To us it’s not a job, it’s what we do. We ride and race on the weekends just like our customers. And, at a customer level, that’s how we relate. We’ve been there, so we know how important contingency is to racing families.

Do you think your impressive contingency efforts will trigger sales this Spring?
While that would be a nice benefit, that really isn’t our mission with contingency. Our mission is to reward those who are competing on KTMs successfully. Does that translate into more sales? It’s hard to accurately gauge. But, over the last two-plus years we’ve seen a healthy increase in the number of KTM entries at all the National race series and most local series. I’d like to say that has more to do with how great our product is than the contingency, but it’s probably a combination of both.

Despite cutting budgets the KTM/FRE GNCC race team seems to be going in full force.
Tim is doing an amazing job with the KTM/FRE team. Last year we had a consistent podium presence in all three major GNCC classes. Angel Atwell and Josh Kirkland are back to defend their titles, and we’ve added Bryan Cook. We couldn’t be happier to have Cook on the team and he’s deserving of his factory ride. This year will be interesting to see what unfolds in XC1, XC2 and Women’s. The talent pool keeps getting deeper in all three classes. But, with Tim’s leadership and Sam Shahan wrenching, we have a great team in place. I can’t say enough about Sam. I don’t know how he gets it done, but he always has three ATVs professionally prepped and running at top form come race day. His work is top notch and he’s super dedicated. [Laughing] Maybe he wrenches in his sleep! But seriously he might have to in the week between Florida and Georgia!

What about the moto scene? Do you know if we’ll see any pro riders running a KTM this year?
Right now our focus is on the Pro-Am class at the AMAs. We are supporting Joe Bruening, Chad Reed, Adam Clark, Derek Swartfager, Ronnie Higgerson and the Australian KTM pro champ Chris Brenton at that level. All five of these guys have what it takes to finish on the podium. We wouldn’t be surprised to see an all KTM podium at some point this season, they are that talented. In New England ATV, we are supporting Mike Pilotte in the Pro class. Talk about potential. Pilotte reminds me a lot of Chad Wienen. He may have a year or two to go to have Wienen-type speed, but Pilottes the real deal. When it makes sense, DRT Racing’s Dave Therrien (who manages Pilotte’s racing efforts) will have Pilotte compete at a few Nationals throughout the year.

Let me ask you this, if the ATV Motocross Nationals were televised on ESPN or Speed would KTM field a professional motocross team?
I don’t think that would really be a big motivating factor. The exposure it would bring to the sport would be great though. When the WPSA was around, those guys knew how to put on a show. It’s hard to believe that was already three years ago!

In your opinion, why should a rider spend a little more and choose KTM over the many ATV choices on the market?
I’ll let all of our shootout victories speak for themselves on this one. Nobody really wants to hear my PR spiel, do they? [Laughing] In all honesty, I was on the other side of the table before I started at KTM. I tested sport ATVs for a living at ATV Sport Magazine for four-plus years. When the KTM came out, I was stunned. And, that opinion hasn’t changed. Our ATVs are built “Ready to Race” from the crate. Heck, you even got an opportunity to experience that for yourself when you raced the John Penton GNCC last year on our 525XC. Chromoly steel components, two different engines with class leading power (SOHC and DOHC), and a design that makes all four ATVs easy to work on … that’s a winning combination in my book.

You used to be an editor for ATV Sport Magazine, so you know the magazine business quite well. We seem to have a lot of publications in this industry, maybe too many as some of them are dying off. Do you think we’ll see new magazines replacing them? Or do you see more printed rags going under in the future?
Truthfully, when the ATV sales were at their peak in 2003-04, there were probably about three or four too many ATV magazines. And, when sales retracted, so did the magazines. I guess I can’t say I’m surprised. For me, the toughest part has been watching friends get forced out of the industry. Back in my magazine days, all of the editors from competing magazines were friends and got along really well. Sure, there was competitiveness in all of us, but we always had fun together at all the press functions. We’ve seen ATV Sport’s printed magazine go away along with Quad Magazine, which was a favorite of mine. When Cassandra Clawson left ATV Sport, part of that magazine died. She was witty and really knew how to run a magazine and that showed when she joined up with Quad. Another really good one is David Schloss. He’s doing a great job with ATV Insider. Every year that magazine keeps getting better. Outside of that I know most of the mags have had to cut back on issues and are struggling, but I sure hope we don’t see any more fail.

What do you miss about no longer being on an editorial staff?
I’ll probably catch some flack here at KTM for saying this, but I do miss the utility side of the business. I’ve had the fortune of test riding basically all of the ATVs on the market, and that really adds to the knowledge well on how things should be engineered to work right. But, it’s been over two years since I’ve thrown a leg over a utility. And, there are some really good utilities out there right now.

What don’t you miss?
I don’t miss people constantly saying the shootouts I took part in at ATV Sport and ATV Magazine were brand slanted and advertising biased. I can’t speak for the other magazines, but the editorial staff at Affinity Group always put out and continues to put out unbiased articles with sound data backing their results. Testing machines and anointing a shootout winner was always a difficult task. No matter what, a reader w
ith heavy brand loyalties would get offended. And, now that I’m on the other side, I can’t say I blame them [Laughing]. But, I felt we always did it the right way at Affinity Group, and I have seen firsthand that they continue on that tradition when KTM is invited to their shootouts.

I couldn’t agree more. As a matter of fact I made reference to this the other day when I pointed out ATV Magazine’s killer Utility 4×4 Shootout that Bill Lanphier wrote. I rode all but one of those big utes and their feature was spot on and completely unbiased in my opinion.
They have a great staff over there for sure, and I think they would do well to hire on Jerrod Kelley full time.

This may be a sore subject with Brett Favre and the Vikings pretty much blowing a chance at the Superbowl, but are you still a Minnesota fan? I know you haven’t jumped ship on your beloved Twins right? Tell me you’re not rooting for the Angels this summer.
I’m a hardcore Minnesota Vikings fan but not to the level of my fiancé. She was crushed after that miserable performance against the Saints. We thought the Super Bowl was the Vikings and Favre’s destiny. Instead we watched Adrian Peterson fumble and Brad Childress send 12 players into the huddle. I was glad we were in California after that game. I’m sure most of Minnesota was miserable and bitter. Outside of the Vikings, yes I’m still a big Twins fan, (Target field opens this year!) And despite living in California hockey is still my number one passion. I’m so-so on the Wild, and truthfully still miss the old North Stars. I could care less about the NBA or T-Wolves.

Well let’s wrap it up. Thank you a ton for all the time you gave me for this interview. Any parting words?
Thanks to all of the riders who recognized the effort KTM is putting into the ATV business. And, thanks to those of you who applied for our racer support program again this year. We received a record amount of resumes before the program was wrapped up in December. We’ve supported more than 100 racers through the program and are overwhelmed with the success it has garnered the first two years. Many of those racers have gone on to win championships and it’s nice to say we had a part in that.

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