Cycle News is a weekly magazine that covers all aspects of motorcycling including Supercross, Motocross and MotoGP as well as new motorcycles
Issue link: https://magazine.cyclenews.com/i/128398
w en g Gibernau Says ~ No To Honda <9 > Spanish MotoGP star Sete Gibemau has III ~ Q. turned down an offer to stay with his Fausto Gresini Honda team, adding fuel to strengthening rumors that he will switch to Ducati for 2006. Gibernau was contracted to TelerUnica MoviStar rather than the team, but with its imminent departure, he was negotiat- ing directly with Gresini. But the former two-time 125cc World Champion confirmed that discussions have ground to a halt. The sticking point is thought to be that the Spaniard insisted the team with the sponsor should match his current fees - around $5 million. "It doesn't seem simple for him to stay in my team," Gresini said at the Malaysian Grand Prix. "I have offered Sete a contract, but I realize that he is not interested in our proposal. He is refusing, so negotia- tions have stopped. "My offer is a good offer," he added, "but it seems for Sete it's not good. It seems he is moving toward Ducati." Gresini refused to confirm that Fortuna would take over as his team's title sponsor in 2006, though paddock sources claim a deal is a certainty. The Birth Of A Major Player Behind the announcement on July 19 that U.S giant Polaris would spend roughly $80 million in purchasing a H percent interest in KTM, and the inevitable expressions of delight and confidence in the union expressed by Polaris president/CEO Tom Tiller and his KTM counterpart Stefan Pierer, there lies the birth of another potential major player in the world of motorcycling. All this comes thanks to a deal which unusually in such circumstances - appears to be a win-win situation for both parties, and, indeed, for their customers and dealers around the globe. That's if the marriage is indeed concluded after what KTM insiders term "a two-year betrothal." The agreement between the two companies stipulates an option for Polaris to acquire a controlling majority of KTM shares in 2007, or else in the unlikely event that things don't work out between them, for Pierer and his partner Rudoph Knuenz to repurchase the H percent of KTM equity that Polaris has just bought. With annual 2004 sales of $1.8 billion, Polaris' revenues dwarf those of KTM, which in 2004 reached a still-impressive $480 million from its product portfolio of 23 different off-road and street motorcycles ranging in size from 50cc to 99Occ. Those bikes were built and marketed by its 1520 employees on the back of a racing heritage which has seen KTM win 106 World Championship titles - 10 ofthem in 2004. But the two companies appear to represent a perfect fit, with KTM's off-road motorcycle line and its growing range of sporting V-twin 10000c road bikes perfectly complementing the Victory range of well-engineered but traditionally American large-capacity V-twin cruisers with which Polaris had already moved into the motorcycle market seven years ago - targeted at carving itself a slice of the booming U.S. V-twin motorcycle market led by Harley-Davidson. Now Polaris powersports dealers will have an off-road motorcycle range to sell next to its snowmobiles and ATVs, thus giving them an important extra product line for when the snow's not on the ground. The agreement specifically envisages a two-year betrothal period, during which each company will continue to be run separately but will collaborate with the other on product development, engine technology, manufacturing, purchasing and distribution. This collaboration in the short term will especially benefit KTM, which has been badly hit in terms of profitability by the 30 percent collapse of the U.S. dollar since 2002, but it will also benefit Polaris, in terms of providing high-end engineering capability for its ATV range (KTM is understood to have already agreed to supply engines to its U.S. partner to power new performance ATV models) and in terms of delivering improved distribution for Victory motorcycles outside the USA through KTM's compa- 12 oaOBER 5, 2005 • CYCLE NEWS ny-owned local importers. Joint purchasing will help drive down costs, selling KTM bikes through Polaris dealers in the USA will increase sales, and Polaris expertise in the ATV market will benefit KTM's imminent arrival in this growing sector with a sporting range of high-tech 450/575cc four-wheelers powered by a dedicated fourstroke motor due to debut in the next 12 months. They will come in typical KTM style with a competition race version (the shared technology of which will also further benefit Polaris), and it can surely only be a matter of time, too, before KTM motorcycles are manufactured in the USA, thus driving down prices in a key market responsible for 25 percent of KTM's total sales volume in the past year by helping reduce exposure to exchange rate fluctuations. "In essence, this partnership combines the substantial strength, passion and success of two industry leaders with very similar, successful 50-year histories, but who do not compete directly today," Polaris CEO Tom Tiller said. "It's a very natural fit for both of us, which will bring benefits to each." Alan Cathcart