KTM racing could be affected after Bajaj Auto, the majority owner of the Austrian brand, ordered it to reduce operating costs by 50%. The move is aimed at restoring the company to a sound state after excessive spending was noticed in various parts of the business.
According to Rajiv Bajaj, managing director of Bajaj Auto, the cost-cutting targets include research and development, marketing, and operations. Of KTM's total 4,000 employees, only about 1,000 are actually in production — which is why he called it an "unbalanced and unsustainable" system.
Bajaj further emphasized that the company needs operational discipline and clear value creation, rather than just chasing valuation. He also added that excessive corporate greed among the management has caused problems for KTM, resulting in high costs and risks in expansion.
As Bajaj Auto strengthens its control over parent company Pierer Mobility AG, expect changes in KTM's structure. But in return, there are fears that funding for motorsport or racing activities will be reduced as part of the cost-cutting measures.
If the cost-cutting is fully implemented, it is expected to affect not only the racing team but also several KTM projects in Europe. The move is part of Bajaj's plan to make the well-known brand's operations more efficient and robust.
