Tata Motors plans to invest Rs18000 Cr to boost EV production: Analysis of Tata’s future plan

Homegrown automaker Tata Motors hopes to hold onto its leadership position in the Indian passenger electric vehicle market by mainstreaming EVs in the nation and growing its current portfolio of five models. Through its EV arm, Tata Passenger Electric Mobility (TPEM), the company currently dominates the market with a significant 73 per cent market share by end-FY24.

With total sales of 73,833 units in FY24—a 48 per cent year-over-year increase—TPEM saw EVs account for over 13 per cent of Tata Motors' total sales of 582,915 passenger vehicles for the whole fiscal year. The carmaker now wants EVs to account for nearly 30% of its total sales by FY30. Consequently, it plans to invest between Rs 16,000 and Rs 18,000 crore in its EV division by the end of the current decade.

Tata Motors stated in an investor presentation on June 11 that, if needed, it will make this massive investment in its EV sector between FY25 and FY30 to meet its future growth ambitions. The company also plans to reach an EBITDA breakeven in TPEM by FY26. Furthermore, the corporation intends to persist in its endeavour to mainstream  EVs in India by means of various measures, including the launch of novel models, broadening the reach of EV retail outlets, and cooperating to enhance the nation's charging infrastructure. 

The business plans to launch ten additional EV models by FY30, however, it now only provides the X-Pres-T EV for fleet operators, the Tigor and Tiago EVs for mass-market consumers, and the Punch and Nexon EVs for aspirational customers. The first two on the horizon are the Harrier EV, which will be unveiled later in the current fiscal year, and the Tata Curvv mid-size EV. The Sierra EV and Avinya EV, which are also scheduled for release in FY26, will come after the first two models and go on sale between April 2025 and March 2026.

The JLR-derived EMA platform and Acti.ev, two of TPEM's two entirely new EV platforms, will be used to tackle the main obstacles to increased range and cutting-edge technologies in contemporary EVs. The business claims that in order to create high-performance, efficient, and updatable EVs in the upcoming years, it will utilise more than 3 billion kilometres of driving data from its current EV parc on the roads.

To reduce range anxiety, it will come with high-energy-density batteries that can be charged quickly. Additionally, the future models will have improved displays that are tailored to the needs of electric vehicles and will include connected car features. Last but not least, the business will prioritise providing customers with cutting-edge driving modes and a range of services including vehicle-to-load and vehicle-to-vehicle EV charging. 

TPEM is optimistic about India's passenger EV market and believes that the PLI programmes, localisation, and falling worldwide battery prices will all help the market grow over the next six years. Furthermore, over the course of the next two years, Tata Motors intends to extend its EV-only retail channel,.ev, which was launched in December of last year, to more than 50 significant cities. 

The major places with high EV potential that the business has identified include high-EV TIV cities, high-penetration clusters, and high-growth-potential markets like Ahmedabad, Pune, Bengaluru, Chennai, and numerous cities in Kerala. Additionally, it has used micro-market data to pinpoint the locations of its outlets. 

Additionally, TPEM will fortify the infrastructure of charging by stepping up cooperation to promote the construction and creation of community and public EV chargers throughout India. Although the company has formed a mutually beneficial partnership with partners in the charging ecosystem, including ChargeZone, Statiq, Glida, Hindustan Petroleum, Bharat Petroleum, and Shell, among others, it hopes to expand the network of charging stations from more than 10,000 by the end of 2024 to 100,000 by FY30.

TPEM wants to increase the number of community charging stations by 23 times, from over 4300 by FY24 to over 100,000 by the end of FY30. The firm intends to expedite its net-zero ambition and encourage EV adoption by using the synergies between rooftop solar (RTS) and EVs. By FY30, the business projects that the percentage of renewable energy utilised to charge its electric vehicles would increase from the current 33 per cent to around 70 per cent.