Bajaj selling KTM to a big-name Formula 1 brand ‘can’t be ruled out’ after cutbacks statement

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Bajaj Group has now taken a controlling stake in the KTM brand, which could be bad news for the Austrian manufacturer having a continued presence as a MotoGP team.

The Austrian financial authorities recently issued permission for Bajaj to buy the shares that Stefan Pierer still held in what had become Pierer Bajaj after the £674m deal that the Indian automotive giant struck in May to save KTM. Pierer Bajaj now has a controlling stake in KTM.

Bajaj now intends to rename Pierer Bajaj to Bajaj Mobility, as it looks to remove any lingering ties to Pierer. But the changes will not stop with the company’s name. Rajiv Bajaj, the CEO of Bajaj Auto – the motorcycle arm of Bajaj Group – has stated that cutbacks are now possible.

Bajaj is looking at cutting KTM’s costs by as much as 50%, with the focus set to be on R&D, marketing and leadership-level positions. Rajiv’s revelation concerning cutbacks at KTM has also triggered fresh doubts about the brand having an ongoing presence as a MotoGP team.

Red Bull buying KTM Racing ‘can’t be ruled out’ after Bajaj touted 50% cuts

And MotoMatters now reports that following Bajaj Group securing a controlling stake in the KTM brand, the ‘most obvious’ outcome of Rajiv’s words would be to sell the MotoGP team. The KTM Racing department is already disconnected from the parent KTM company, as well.

READ MORE: Everything to know about KTM from the MotoGP team’s riders to hierarchy

Additionally, it ‘can’t be ruled out’ that energy drinks brand Red Bull would look to buy KTM, if the MotoGP team were to hit the market. Red Bull is already KTM’s main sponsor, but has yet to announce a public interest in moving from sponsor to owner of KTM Factory Racing.

Bajaj could have alternative avenues to explore if it looks to sell KTM, too, as there is also an ‘intriguing prospect’ of a Chinese manufacturer taking an interest in buying the team. But an option that seems ‘vanishingly unlikely’ is that BMW would buy KTM to then enter MotoGP.

Red Bull was linked with buying KTM after the brand entered administration

At the height of KTM’s financial problems one year ago, which even saw the company enter administration, Red Bull was touted as a potential buyer for the MotoGP team. Reports also suggested at the time that Red Bull faced a £50-100m asking price to buy KTM this January.

Red Bull GmbH often uses extreme sports as a key marketing material beyond sponsoring an existing brand, such as venturing into Formula 1 with the Red Bull Racing team since 2005. It took over the ailing Jaguar F1 crew, and RBR are now one of the most successful teams in F1.

Only five teams in F1’s history since the four-wheel championship started back in 1950 have won the constructors’ title more often than Red Bull’s six titles to date. Also, Red Bull’s eight drivers’ titles so far place the team behind only Ferrari (15), McLaren (12) and Mercedes (9).

KTM have not enjoyed the same levels of premier class success since their debut during the 2017 MotoGP season. To date, riders across the factory KTM outfit and their satellite squad Tech3 have taken five wins with Miguel Oliveira’s 2022 Thai Grand Prix win the most recent.