Rajiv Bajaj’s Statement That Is Causing Panic In KTM

A single remark from Rajiv Bajaj has set off a wave of anxiety thousands of miles away in Austria. In an interview to CBNC TV18,, Rajiv Bajaj bluntly said that 'European production is dead', in a statement that alludes to the high cost of production in Austria.

As the head of Bajaj Auto, which now owns KTM, his statement that European production for KTM is effectively finished has left workers at the Austrian plants worried about their future. Though company officials in Austria have tried to reassure employees that production will continue, Bajaj’s words carry weight because Bajaj Auto now calls the shots.

The concern stems from a shift in control. Bajaj Auto first took a minority stake in KTM in the late 2000s and gradually built it into a controlling shareholding. With that, KTM is no longer just an Austrian company with an Indian partner.

It is a brand owned and directed by an Indian manufacturer with global ambitions. For Bajaj Auto, profitability and efficiency are paramount, and the logic of shifting production to India is strong.

India today has the capability to produce not only single-cylinder motorcycles but also advanced twin-cylinder engines. Royal Enfield already makes twins domestically, and TVS is set to produce liquid-cooled twins for BMW Motorrad.

Bajaj, with its experience and scale, has every reason to believe that KTM’s entire range could eventually be manufactured in India without loss of quality. The cost savings of doing so are enormous compared to maintaining high-cost European production lines.

For Austrian workers, however, the implications are grim. KTM’s factories in Mattighofen have been the heart of the company for decades. They symbolise not only jobs but also heritage and engineering pride.

The thought of production moving away threatens both livelihoods and identity. Even if research and development remain in Austria, the loss of manufacturing would be a major blow.

There is also the matter of KTM’s partnership with CFMoto in China, which had served as a low-cost production base. With Bajaj now in charge, the need for that tie-up may diminish. Bajaj can offer KTM the same, if not greater, cost efficiencies in India, along with stronger control and integration. If KTM’s Chinese production gets phased out and Austrian production is reduced or shut, India becomes the undisputed manufacturing hub.

From a business standpoint, this realignment makes sense. Bajaj Auto is a publicly listed company with shareholders to answer to. Running parallel production lines in Austria and China when India can handle it more cheaply is hard to justify.

Moving production to India would allow KTM to price its models more competitively and increase margins, ensuring the brand’s survival in a highly competitive global market.

For the motorcycle industry at large, Bajaj’s statement is a clear signal of how global manufacturing is shifting. Traditional centres of production in Europe may no longer be able to compete with cost structures in Asia. Companies are consolidating where it makes sense, and heritage alone may not be enough to preserve jobs in high-cost regions.

For buyers, the impact might be positive in terms of pricing and availability of KTM models. For employees in Austria, it is a period of deep uncertainty. For Bajaj, it is about balancing profitability with legacy. Regardless of reassurances, the writing on the wall suggests that KTM’s Austrian factories may eventually serve a smaller role focused on design and R&D, while India takes over as the primary production base.

Rajiv Bajaj’s statement may have caused panic, but it also reflects the hard realities of global manufacturing. KTM’s future may still be shaped in Austria, but its present and production base look increasingly tied to India.