Pierer Mobility SWOT & PESTLE Analysis

Strength

1. Developmental role in electric powertrain innovation: Firstly, off-road motorcycles have gained considerable popularity in recent years. Secondly, rising environmental awareness and government focus to reduce CO2 emissions all over the world is creating markets for electric two wheelers. Pierer Mobility has realised the market opportunity produced by synergistic effect of both these aspects and takes leading role to develop electric powertrains. This reflects in their development of high-power electric motorcycle, KTM FREERIDE E. The company has also put across structures to aid research and development of alternate forms of mobility for different kind of applications.

2. Offers full and diverse range of off-road motorcycles: Pierer Mobility acquired Spanish off-road brand GASGAS in fourth quarter of 2018 to enter into trial motorcycle segment. They also integrated Husqvarna motorcycles to cater to a larger target audience pertaining to off-road motorcycles. Diversifying further, KTM made developments also in the four-wheeler segment by producing KTM X-BOW sports car. ` In December 2019, they fully consolidated the electric bicycle division of German brand PEXCO to facilitate entry in e-bicycle division. They have proved themselves to be capable to design new product ranges apart from traditional models. They understand different needs of different audiences and operate accordingly. They perform mergers and acquisitions boldly and frequently to cater to these changing needs. They have also acquired stake in AVOCODO GmbH to be future ready for digital solutions like developing mobile applications and infotainment systems for motorcycles.

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Weakness

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Opportunity

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Threat

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Political

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Economic

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Social

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Technological

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Legal

1. New Euro 5 emission standards for two wheelers in European Union: From 1 January 2020 onwards all new motorcycles and mopeds in European Union (EU) and Europe Free Trade Area (EFTA) will have to be compliant to Euro 5 emission standards replacing Euro 4. Technological innovations play a major role in bringing down the vehicular emissions and the companies have to be agile to adopt these innovations. A significantly better exhaust system in bikes would be required. These strict emission standards will ramp up the costs of powered two wheelers. A consolidation among manufacturers is a possibility because of new Euro 5 standards.

2. Regulations to be a key driver for the transition to electric vehicles: Regulations would be a central factor of the electric vehicle shift. In India, a key market for PIERER Mobility, a proposal was debated (but not yet approved) to implement a target for achieving 100 percent electric sales for the two-wheeler industry by 2025 which will, in our opinion, generate a very significant growth potential for the company. Similarly, environmental restrictions in other countries are expected to influence the speed of the electric transformation as well as the measures needed to minimize emissions from conventional vehicles, e.g., compliance with Euro 5 would be compulsory in the EU from January 2021.

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Environmental

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