The soap opera of KTMits new owners and their financial situation remains full. And it is not for less, taking into account the latest statements of Rajiv BajajExecutive Director of Bajaj Autothe current Indian business group owner of the brand that saved the Austrian company from an almost inevitable economic bankruptcy, which has recently assured that “European manufacturing is dead.”
KTM will follow the example of other European manufacturers
Almost two years ago, KTM began a long and cobbled road to the attempt of his economic salvation, where his continuity was also played within the two -wheeled sector. Throughout this time, news of all kinds have occurred where we have witnessed mass layoff Gottfried Neumeister which currently occupies the position.
As we all intuit, this whole process has made the global situation rethink the new owners of the brand, Bajaj Auto, who between some things and others have already disbursed from the order of the 800 million euros to be able to keep the Austrian firm afloat. So, in the midst of all this financial and business martemágnum, it was expected that draft changes in the brand structure of the brand or in sections as essential as the manufacturing.
It has been Rajiv Bajaj, during the course of one of his interviews in a television channel of Economics of India television who has explained with hairs and signs what is the future of KTM, in the short and medium term, if he wants to re -achieve a level of full competitiveness within the two -wheeled sector and this inevitably passes, for stopping to stop manufacturing in Europe almost all of its products.
In addition, Bajaj Auto’s mandamás advocates a general simplification of operations. To do this, as he explains: “We have to restore the brand (KTM). As unfortunately it sometimes occurs with success, it tends to blur it by extending it to too many categories, too many segments; even beyond the main segment. And the second consequence of the brand’s blur is the proliferation of skus (stock maintenance units), which greatly complicates the business, from R&D to the workshop of the concessionaire.”
However, that restructuring of which Bajaj speaks is indissoluble to a total cost of costs and on this aspect it has very clear what the current situation is: “European manufacturing is dead. I think the automotive industry, including car, understands it.” And to sustain this argument, it puts as an example to Triumph that, except for the limited editing TFC models, it currently manufactures the rest of its products in Thailand, as specified by Ride Apart.
“Could KTM do the same?”Bajaj wonders … maybe not suddenly, since that would cause endless social protests and would probably have political impediments. But gradually in the coming years. In fact, last year, with Stefan still pier in office, the predisposition of the brand to leave Europe was already suggested in terms of manufacturing, something that is finally confirmed from the mouth of Rajiv Bajaj himself.
In addition, the latter supports its adjustment plan with numbers: “We had never shared this specifically before, but I tell you that, although KTM is going through difficulties in Europe, the KTM that we manufacture and export from India to different parts of the world generate a Ebitda margin of more than 30 %.”
Concludes: “The main reason is the great cost competitiveness that India offers, its supply chain and our excellent suppliers. Therefore, we have to readjust the cost of KTM. We have to recover the brand, and if we manage to do it effectively, I think KTM has a brilliant future.”
