Bajaj Auto Ltd, India’s largest exporter of motorcycles, and the company’s Austrian partner KTM AG are extending their partnership to Indonesia, the biggest motorcycle market in South East Asia, the Pune-based firm said in a filing to the stock exchanges on Friday.
As part of the agreement, KTM, through its distribution network in the country, will sell the KTM-branded Duke and RC motorcycles (up to 400cc) which will be managed by Bajaj. The bikes are made by the KTM-Bajaj joint venture at the latter’s factory in Chakan.
In 2014-15, Bajaj Auto sold 3.29 million units, of which 46% were exported, as against 41.6% in the previous year. The company’s decade-long association with KTM has been a big success. It has helped Bajaj gain a toehold in advanced markets such as the US, Europe, Canada, Japan and Australia, as it ships “made in India” KTM bikes.
For KTM, which was in the red when Bajaj acquired a 14% stake in 2007, the association with Bajaj has helped it become Europe’s second-largest motorcycle maker. Between 2007 and 2012, Bajaj, through its subsidiary Bajaj Auto International Holdings BV, continued shoring up its stake in KTM to 48%.
“The decision to emphasise our sales activities in the South Asian distribution network is the logical next step in our long term oriented strategy. It supports our presence in the price sensitive Indonesian market by using synergies from our strong alliance with Bajaj,” said Hubert Trunkenpotz, chief sales officer, KTM AG. For Bajaj Auto, the decision to distribute KTM bikes in Indonesia is a major step forward, said Rakesh Sharma, president international business at Bajaj Auto in the statement.
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