Wednesday, November 7, 2007

Bajaj Auto announces wide-ranging co-operation with the 2nd largest European sport motorcycle manufacturer KTM Power Sports AG

Development of engine and vehicle platforms:

The KTM Group provides the know-how for the joint development of high-efficient water-cooled 4-stroke engines (125-ccm and 250-ccm), which provide KTM the basis for street motorcycles in the new street entry segment. The joint developments will also be available as basis for Bajaj-products.

Through the cooperation with Bajaj, KTM extends its product portfolio for the future with a 125-ccm street product line, in addition to the present 1190-ccm, 990-ccm and 690-ccm platforms developed and manufactured in Austria. With the introduction of the new EU driving licence which allows riding of 125-ccm motorcycles with a car driving licence in all EU member States, KTM will be in a position to offer innovative premium entry models in the street segment.

Natural hedging-potential due to sourcing of entry motorcycles in India:

The sourcing for the production and the assembling of these new models in the street entry segment will occur in India. Thus the KTM Group is able to develop a natural hedging-potential for its USD-exposure in the future.

Strengthening of the KTM sales structure in South – Eastern Asia:

Bajaj takes over the sales of KTM products in India and further countries in South – Eastern Asia. Through this cooperation KTM opens up the Asian region and receives new opportunities for the sales of the entire KTM-product portfolio.

Sustained growth in the future:

The publicly listed Bajaj Auto Ltd. has emphasized the strategic importance of these projects through the acquisition over the capital markets, through its 100% Netherlands subsidiary – Bajaj Auto International Holdings BV - of an interest of 14.5% in KTM Power Sports AG.

Stefan Pierer KTM CEO welcoming Bajaj participation said:

“The Executive Board of KTM Power Sports AG appreciates this measure and sees in the cooperation a great chance to strengthen the KTM Group in its sustained growth strategy in a global environment.”

Commenting on the co-operation, Bajaj CEO Rajiv Bajaj said:

“KTM’s sharp brand positioning, differentiated designs, and hyper performance have inspired Bajaj to invest in this participation.

Bajaj is delighted with this opportunity to co-develop a range of products for manufacture by Bajaj for both KTM and Bajaj brands. Equally Bajaj is excited by the prospect of introducing KTM products to India and South East Asia, as also to access the European market via KTM.

Bajaj is confident that this co-operation represents a long term win-win situation given the entirely complementary and conflict free nature of the partners in brand positioning, market presence, product plans and supply chain structure“.

About KTM Power Sports AG:

KTM Power Sports AG is a worldwide leading manufacturer of power sports vehicles. KTM has won more than 136 World Championship titles and seven times the Rallye Paris-Dakar. The operation core company, KTM-Sportmotorcycle AG, develops and manufactures competition off-road and street motorcycles. KTM-Sportcar AG builds the light-weight sports car X-Bow, KTM’s first step into the automotive field. With more than 1,930 employees, the KTM Group earned revenue of 566.1 Mio. EUR (INR 32 Billion) in fiscal year 2006/07. Over 23 sales subsidiaries distribute KTM products to their 1,400 independent KTM dealerships worldwide.

KTM is a Vienna Stock Exchange listed Company with market capitalisation of Euro 390 million (INR 22 Billion).

KTM is a group company of CROSS Industries AG, indirectly owned by & managed by Messrs Stefan Pierer and Rudolf Knunz. The Cross-group’s other businesses include among others racing motorsports systems, composites, etc

Further information about the KTM Group is to be found at

About Bajaj Auto Ltd.:

Bajaj Auto Ltd, is India’s second largest motorcycle manufacturer and ranks among top five motorcycle producer in the world. In the fiscal year 2006-07 Bajaj produced and sold about 2.38 million Motorcycles and over 320,000 automotive 3-wheelers. Its Motorcycle brands the Bajaj Pulsar DTSi, the Bajaj Discover DTSi, the Bajaj XCD DTS-Si are extremely popular in India, South & South East Asia, Africa and Latin & Central American Countries. Bajaj exported over 440,000 units (over 16% of its production) in 2006-07. It achieved consolidated revenues of Rs 166 Billion (Euro 2.9 Billion). Automotive segment accounted for 57% of Revenues, Financial Services 40% and Investment & other activities the balance. Consolidated net profits for FY 07 stood at Rs 12.5 Billion (Euro 220 Million)

Bajaj is listed on Bombay Stock Exchange and Indian National Stock Exchange with market capitalisation of INR 245 Billion (Euro 4.3 Billion). Its GDRs are listed on the London Stock Exchange.

Bajaj Auto is the flagship of the Bajaj group of Companies. Bajaj Group’s other interests include Life & General Insurance (in partnership with Allianz of Germany). Retail Financing, Steel and Electrical Appliances. Mr Rahul Bajaj (Member of the Upper House of Indian Parliament) heads Bajaj Group of Companies.

Mr Rajiv Bajaj is Managing Director and CEO of Bajaj Auto Ltd.

Further Information about Bajaj Auto Ltd. is to be found at

Flickr: Photos from bansi_nickname.

Flickr: Photos from desmoworks.

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