The EV sales in India are expected to grow massively in the next five years, compelling Tata to bolster its ecosystem.
Shailesh Chandra, the managing director of Tata Motors’ passenger vehicles and electric mobility segments, recently disclosed to the press that the company plans to invest Rs.160 to 180 billion to develop its EV business portfolio.
The company anticipates that domestic sales of electric vehicles will increase tenfold in the next five years, aiming to dominate 30-40% of the total sales by FY30. However, according to the company, this growth is expected to fall short of the government’s earlier target of achieving 30% of new car sales.
Tata Motors, a major player in electric car sales nationally, previously estimated that up to half of its total sales would come from electric vehicles by 2030.
In general, the company sees a higher proportion of CNG and EVs in its sales mix. It aims to increase its market share in passenger vehicles to 18-20% during this period, up from 13.9% in FY24.
As the MD mentioned, it plans to expand its addressable market. Currently, with seven products, it covers 53% of the market and holds a 26% market share within this segment. The goal is to grow its addressable market to 80% by FY30.
Tata Motors’ growth strategy will involve introducing new models and updating current ones. Over the next two years, the company plans to launch the Curvv EV, Curvv ICE (internal combustion engine), and Sierra EV.
Besides, Tata’s passenger vehicles segment, now self-sustainable, targets 10% EBITDA margins for both combustion engine and electric vehicle segments. Jaguar Land Rover will remain part of this division, which is set to be debt-free next year. Q1 expects the commercial and passenger vehicle business to split in the next fiscal year.
Tata Motors Group CFO P. Balaji stated to the Economic Times that separating Tata Motors’ commercial vehicles business will enable the resulting companies to focus more effectively on their growth strategies.
After the demerger, Tata Motors’ commercial vehicle division, previously a significant revenue generator, will have the flexibility to reinvest its cash flows into its strategies.
