In the ever-turbulent world of motorcycles, where the roar of engines often masks the whispers of boardroom deals, KTM finds itself once again at the crossroads of survival and collapse after its tough last year.
The Austrian marque, renowned for its off-road prowess, has been grappling with financial headwinds that threaten to stall its journey.
Bajaj Will Save KTM With Injection of €600 Million
Back in November 2024, KTM initiated insolvency proceedings, a move that sent shockwaves through the industry. The company cited a confluence of challenges: pandemic-induced demand fluctuations, escalating production costs, and an overwhelming inventory of approximately 265,000 unsold motorcycles, many of which failed to meet the stringent Euro5+ emissions standards.
By February 2025, a glimmer of hope emerged as KTM secured a court-approved restructuring plan, agreeing to repay 30% of its €2.2 billion debt, contingent upon a €600 million payment by May 23.
Enter Bajaj Auto, KTM’s long-standing Indian partner, which had previously infused €200 million to reignite production in April. However, this revival was short-lived, with operations halting again due to supply chain disruptions. In a strategic maneuver, Bajaj’s European subsidiary recently secured an unsecured loan of €566 million from financial giants JPMorgan, DBS, and Citigroup.
While officially earmarked for “investments,” the timing and magnitude of this loan strongly suggest its purpose is to bolster KTM’s restructuring efforts.
Bajaj’s involvement with KTM dates back to 2007, gradually increasing its stake to nearly 50% in PTW Holding AG by 2021. This deep-rooted relationship underscores Bajaj’s vested interest in KTM’s continuity. With the €600 million deadline looming, this financial lifeline could be the crucial throttle twist KTM needs to navigate out of its fiscal quagmire.
Yet, the road ahead remains uncertain. While this infusion may provide temporary relief, questions linger about KTM’s long-term viability and whether this is a mere pit stop or the final lap in its storied journey.
Update: KTM and Bajaj have confirmed what the money is for. Bajaj is now majority owner.
