Last week saw an interesting update on the Bajaj Auto-KTM partnership where plans are underway to effect a change in the existing equity structure.

Bajaj, which holds 48 per cent in KTM AG, is now looking at transferring this component to the parent company, KTM Industrie, where Pierer Industrie holds 62 per cent. In the process, the parent company’s stake in KTM AG will be up from 51.7 to 99.7 per cent.

What does this mean for Bajaj Auto? Holding a stake in the parent could mean leveraging more opportunities with its partner in the global arena, which is seeing massive mobility disruptions. In the process, this will signal a deeper bonding between the two companies.

It was back in 2007 when Bajaj acquired a 14 per cent stake in KTM that has since grown to 48 per cent. Beyond the equity component, the two have built an edifice of trust and faith, which has seen KTM farm out production responsibilities of lower displacement engine Duke motorcycles to Bajaj.

These are produced at the Chakan plant and exported to a host of countries across the world. The next phase of the partnership will now see some Husqvarna bike models also made at Chakan and shipped out to other regions. KTM had acquired this Swedish brand from BMW Motorrad five years ago and has worked successfully towards its revival.

Bajaj has also forged an alliance with Triumph of the UK, which will see mid-capacity motorcycles manufactured in Chakan and exported to other markets. The first model is scheduled to roll out in 2021 and it will be interesting to see how the new powerhouse in the form of Bajaj-KTM along with Triumph draft their growth blueprint for the following decade.

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