Racing among ‘low-hanging fruit’ as Bajaj prepares KTM overhaul

Bajaj Auto, which is awaiting European Commission approval for its takeover of KTM, plans to slash overhead costs by up to 50%, with racing among the areas identified for savings.

Bajaj managing director Rajiv Bajaj told CNBC-TV18 that “low-hanging fruit” across “R&D, marketing (including racing), operations, and general administration” would be targeted under the company’s cost-cutting strategy.

“The previous management has already reduced headcount from 6,000 to 4,000, which is still considered too high,” Bajaj added.

“Interestingly, of these 4,000, only about 1,000 are blue-collar; 3,000 are white-collar, which is perplexing because the blue-collar employees make the motorcycles.

“Future volume shifts will impact blue-collar employees relatively lightly; the issue will be with expensive white-collar headcount.

“It reminds me of Mark Zuckerberg’s words about managers managing managers managing managers who manage the people who do the work.

“The management overhead and bureaucracy in this otherwise excellent organisation were astonishing.”

Bajaj’s comments will heighten concern over the future of KTM’s MotoGP project.

The Austrian factory is contracted to the premier-class – with four riders, divided among the factory and Tech3 teams – until the end of 2026.

Although, like the other manufacturers, it is yet to sign for the next contract cycle starting in 2027, KTM has signalled its intentions by becoming the first manufacturer to show a working version of a future 850cc engine.

«Nobody would have approved the [creation of the new 850cc] engine only to then not deliver it. We are in MotoGP to stay there,» KTM motorsport director Pit Beirer told Speedweek.com.

Meanwhile, Bajaj said that “three types of greed… operational, strategic and governance” were to blame for KTM’s financial struggles and confirmed that final takeover approval is imminent.

“We are now waiting for the key approval from the takeover commission. We understand that this may be forthcoming in November.

“We hope it will be positive, which means that after almost an 18-year association in which we have been a minority partner, we would become a 76% shareholder in KTM AG, and from being an observer, we would take charge.”

Tomado de https://www.crash.net/rss/dakar