What Happens To KTM Husqvarna? Will History Repeat Itself?

KTM is in trouble. 

The maker of some of the most extreme off-road, enduro and street motorcycles has sought financial help to keep its operations afloat. A lot of big names in the industry have shown interest in saving this Austrian manufacturer but one of its partners seems dedicated to keeping the brand alive. With news of Bajaj Auto investing a hefty sum to offset the losses, it seems that KTM could soon announce changes in terms of its partnership with Bajaj in the hope of keeping its legacy alive. 

Bajaj Auto has released a mega sum of INR 1,360 crore to Bajaj Auto International Holdings BV, Netherlands, an investment firm owned by India’s Bajaj Auto. Although the intentions behind the fund release haven’t been clarified, it seems that Bajaj could help absorb the financial losses of KTM and help the Austrian motorcycle maker continue its journey in the world of motorcycles. Bajaj is presently involved in a production and marketing partnership with KTM for its small displacement motorcycles in India, the former having a 49.9 per cent stake in KTM. 

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Will KTM be a Bajaj brand now?

As long as both companies don’t make an official announcement, you and me can only make wild guesses. Since guesses don’t cost a penny, there are a lot of possibilities we can imagine. 

The easiest step would be to let Bajaj’s investment firm help KTM through its financial struggles and recommend suitable business directions to showcase growth. In a fledgling large-capacity motorcycle market, Bajaj’s marketing and sales expertise could be of great help to KTM. Pierer Mobility AG could also pump in more funds to help the ailing brand write-off its losses and figure a fresh new approach for business.

 The second possibility could involve Bajaj acquiring more stake in KTM and operating it as its premium international brand. Bajaj and KTM have been sharing R&D for sub-400 cc category motorcycles – a majority stake would allow Bajaj to utilise its expertise in cost-cutting and make KTM’s premium offerings more accessible. Bajaj’s presence in South African nations could also help KTM in a big way. 

Another possibility could be a Tata-JLR merger lookalike, where Bajaj would buy KTM and invest in better resources to let KTM do what it does best – make great off-road, enduro, adventure and street motorcycles. 

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What about Husqvarna?

Since Husqvarna is part of KTM, the Swedish brand could continue making street and off-road motorcycles derived from KTM counterparts. Husqvarna hasn’t had much luck in India with its competitively priced Vitpilen 250 and Svartpilen 401 models despite sharing showroom space with KTM models. A new flow of cash could help KTM inject more money into marketing and encourage more buyers to consider these retro alternatives to the KTM Duke family. 

KTM was bankrupt in the early 90’s

KTM, which stands for Kronreif & Trunkenpolz Mattighofen, used to be a maker of motorcycles and mopeds until it went bankrupt in 1991 and had to be saved by Stefan Pierer. Under Pierer Mobility AG’s ownership, KTM switched its focus to off-road motorcycles and eventually to big road bikes. The transition to a premium two-wheeler brand happened swiftly and after Bajaj’s investment in 2007, KTM found inroads into the small-displacement category of street motorcycles. 

 Bajaj eventually sought an engineering partnership with the Austrian brand and hence, in 2012, Bajaj and KTM launched the Duke 200 in India as well as other markets. The Duke lineup helped KTM cement its position in the growing Indian market and become a household name for fast and performance-centric motorcycles. Subsequently, smaller versions of the RC and Adventure series motorcycles spawned, thus helping KTM acquire a decent share in the premium segment. 

KTM had also acquired a couple of other names throughout the years. The brand acquired Husqvarna motorcycles from BMW Motorrad in 2013, had a significant investment in Gas Gas offroad bikes and participated in Moto GP as both a constructor and a factory team. 

Lately, KTM and Bajaj have unveiled the 390 Adventure series in global and Indian markets, expanding the lineup to fend off the competition from brands like Royal Enfield, Suzuki, Classic Legends and other small-capacity motorcycle brands. KTM also introduced its big bike lineup to India, including the Duke 790, 1390 Super Duke, the 1290 Adventure and the rest of its enduro and off-road motorcycles. 

Despite KTM’s brand image concerns, the Austrian motorcycle maker has a lot of potential in developing markets like India that worship the motorcycle as both a utility and a hobby. 

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