Bajaj Auto Ltd has announced that the Second largest European sport motorcycle manufacturer KTM Power Sports AG, and the Second largest Indian Motorcycle manufacturer Bajaj Auto Ltd, announced wide-ranging co-operation on November 05, 2007.
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 for KTM due to sourcing of entry motorcycle 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 distribution 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 of manufacture by Bajaj for both KTM and Bajaj brand. 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."
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Union Budget