Bajaj Auto Moves to Cut Over 50% of Workforce at KTM Amid Restructuring Drive

Indian two-wheeler giant Bajaj Auto, which has been gradually strengthening its control over KTM, confirmed that the Austrian motorcycle manufacturer will undergo a sweeping cost-reduction programme that will reduce overheads by more than 50 % in multiple non‐production areas.
In an interview, Bajaj’s Managing Director Rajiv Bajaj said the company sees “low-hanging fruit” in streamlining what he described as an excessive white-collar workforce, remarking that of the approximately 4,000 current KTM employees only about 1,000 are factory (blue-collar) workers and the remaining 3,000 are office‐based roles — a ratio he says is unsustainable. 
Restructuring scopeThe cuts are expected to span R&D, marketing (including racing activities), general administration and global operations. Motorsports programmes for KTM’s factory teams, including its involvement in MotoGP, may also be impacted.
KTM had already reduced its workforce from about 6,000 to around 4,000 under prior management, but Bajaj’s leadership believes further reductions are necessary to restore financial stability and operational efficiency. 
Background and rationaleKTM has faced several headwinds: overproduction following the pandemic-led demand surge, inventory build-up, a costly diversification into segments such as electric bicycles, and rising costs in its manufacturing ecosystem. These factors pushed KTM into financial distress and triggered deeper involvement by Bajaj Auto, which had been a long‐term partner and investor in KTM.
Rajiv Bajaj faulted the previous KTM leadership for “operational greed, strategic greed, governance greed” — accusing them of mis-managing the business, producing beyond demand and entering ventures lacking a clear return. 
ImplicationsThe move signals a sharp pivot for KTM: from aggressive expansion to cost-control and structural realignment. For Bajaj Auto, which holds a significant stake in KTM’s parent company and aims to finalise full control, the restructuring is pivotal to turn around the business.
For employees, the impact will be most pronounced among white-collar roles globally, with comparatively lesser direct effect on factory floor workers. Motorsport programmes may be downsized or scaled back as budget priorities shift. Analysts say this is part of a broader trend in the global manufacturing and automotive sectors, where companies are recalibrating post-pandemic staffing and cost structures.
What to watch

Specific head-count numbers and timelines for the job cuts have not yet been fully disclosed.

How much the restructuring will affect KTM’s motorsport commitments, brand positioning and product development.

The reaction from unions, employees and dealers, especially in Austria and India.

The effect on Bajaj Auto’s business strategy in India and globally — how the cost savings will translate into profitability or reinvestment.

How the move influences investor sentiment and regulatory scrutiny as the takeover process continues.

ConclusionWith this decisive downsizing plan, Bajaj Auto is steering KTM into a new chapter: one focused on leaner operations, tighter cost control and higher accountability. But the transition also carries risks — especially in maintaining brand equity, sustaining innovation and keeping morale high amid major organisational change.
 

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