5 Questions With... MV Agusta CEO Giovanni Castiglioni

Q: Why did Harley-Davidson sell MV Agusta back to the Castiglioni family, when it could have made much more money selling to a private equity firm?

A: The contract we made with Harley in 2008 was quite strict. They would have had problems selling to somebody else in a way that was anything but expensive for them. We still had yet to receive part of a deferred payment, between 16 and 18 million euro.

Q: Is it true that you reacquired MV Agusta with a clean balance sheet?

A: Yes, indeed, the company has zero debt today. We also have good working capital and cash in the bank. We have a solid structure, a good brand and new products generated via substantial investment from Harley-Davidson. The F4, Brutale and F3 are all paid for in terms of development costs to date.

Q: When will the F3 enter production?

A: We’re pushing for September, but I believe we will launch the final production F3 at the EICMA Show in November this year, and start production the very same week. It will go on sale in the first week of January 2012, at the latest. We’ll also display the Brutale 675 at EICMA, and plan to enter production with that in spring 2012.

Q: What is your break-even point for MV Agusta in terms of total annual production?

A: In 2010 we produced around 3500 motor-cycles. Our plan is to increase that first to 4000 units, then gradually up to 8000 motorcycles after the F3 is launched, and eventually to a ceiling of 11,000 bikes per year.

Q: You’ve only spoken about MV Agusta. Do you have any plans to revive the Cagiva marque, perhaps as an off-road brand?

A: We have no plans for Cagiva at the moment, because MV Agusta comes first. We have limited resources, not only in terms of cash but also in personnel, to get this project done right. When the company is breaking even with MV, maybe we can think about restarting Cagiva. But right now it makes no sense to go in two directions at once.