Orange Alert: Will Bajaj, CF Moto or BMW Take Over KTM?

February 25 is going to be a very important day for KTM as its fate as an automotive brand will be decided today. Creditors will take a call on the restructuring plan for KTM which is facing severe debt and is on the verge of bankruptcy. According to reports KTM has received over 20 offers to resurrect the brand but there are three motorcycle manufacturers which are in the fray - Bajaj Auto, CF Moto and BMW Motorrad.

Recent reports have claimed that Bajaj Auto has already allocated ₹1,360 crore through its subsidiary Bajaj Auto International Holdings BV (BAIHBV) based in the Netherlands. Via BAIHBV, the Indian brand already holds a 49.9% reported stake in Pierer Bajaj AG (PBAG) in Austria, which controls nearly 75 percent of Pierer Mobility AG, the owner of KTM motorcycles. If Bajaj Auto is able to pump in the additional funds, it should help it get the controlling stake in KTM, but whether this is possible or not is something we shall find out this evening. Bajaj and KTM share a cordial relationship as the Indian manufacturer had picked up 14.5 per cent stake in KTM in 2007 and later Bajaj Auto started manufacturing KTM motorcycles in India, which were also eventually exported.

The other brand with which KTM has a joint venture is Chinese manufacturer - CF Moto. Both the bikemakers entered into a partnership in 2017 and CF Moto started manufacturing KTM bikes in China, which were exported to other Asian countries too. The technology transfer between the two companies led to the creation of the CFMOTO 800MT and the CFMOTO 1250TR-G. For the Chinese brand acquiring KTM will be a big boost as it’s working hard on expanding its premium motorcycle line-up and KTM already has a well established range of motorcycles.

The darkhorse in this race is BMW Motorrad. According to reports, BMW wants to purchase KTM and ensure that it continues in the market. However, it’s also rumoured that the German brand wants to move R&D to Bavaria as it will help in reducing cost while utilising the KTM tech to further advance and improve its range of motorcycles. The report also suggested that BMW would dilute KTM Austria and in this process lay off all the KTM employees and plans to move production to India. If this does happen, it will be interesting to see whether Bajaj Auto will continue to be the manufacturing partner of Team Orange or it will be shifted to TVS Motor, the German giant's current Indian partner.

As you can see the KTM saga has more twists and turns than a Bollywood masala flick, all we want is for KTM to say ‘Picture abhi baaki hai’.