EV Adoption Maturing: Tata Motors Group CFO Emphasizes Strengthening Market Development

Tata Motors aims to boost EV penetration by addressing concerns of new buyers and developing the market. Despite missing its target of 1 lakh EV sales in FY24, the company remains optimistic about surpassing this milestone in the current fiscal year. Tata Motors is investing in charging infrastructure and collaborating with solar companies to enhance EV adoption. JLR's decision regarding incentives under India's EV policy remains open, with all options being considered.

With the phase of early enthusiastic buyers adopting passenger electric vehicles 'probably getting over', Tata Motors will focus on market development to boost EV penetration in India and address various concerns of the new set of customers, its group CFO PB Balaji said on Friday.

The company, which missed out on its guidance of selling 1 lakh units of passenger electric vehicles in FY24, is confident of crossing the milestone this fiscal, even as it keeps all options open for its British arm Jaguar Land Rover on whether to apply for incentives under India's new EV policy and manufacturing in India or not.

Addressing an earnings call, Balaji said Tata Motors is committed to the expansion of EVs, and this year, the company would launch its Curvv EV as part of the plan.

''We would obviously want to build momentum on that. At the same time, we are also clear that the phase of the early majority wanting to come in on an enthusiastic mode is probably getting over,'' he said.

While a new set of customers is starting to come, he said a majority of them ''will require much more reassurance in terms of charging infrastructure, TCO (total cost of ownership) economics, residual value, variety, choice of models and various use cases''. Asserting that the company does not see the current situation as a challenge, he said, ''We see this more as a phase of exciting market development''. It is normal for any market that is developing to reach a particular point and hold for a bit, Balaji said, adding that ''it is absolutely natural, and we do not see a concern from that perspective at all. We saw that earlier too and we will see it again''. ''So, our entire focus this year is to work on the market development front, on stepping up the EV penetration and that is a nice place to be because it will also give us excellent returns as we start solving those barriers to adoption (of EV) in each of those,'' he added. The focus of the company is to address what is stopping EV adoption faster and clear the pathway for it to start accelerating again.

''We are not talking about a growth crisis here, we are actually looking at how to step up the penetration. We (Tata Motors) used to have 1 per cent penetration, we are sitting at 13 per cent penetration of our portfolio as electric,'' he said, adding that this would only keep increasing as more and more cars come into the market.

Tata Motors is tying up with various charge point operators to set up almost 22,000 chargers in the coming years, he said, adding that the company is also ''working with solar rooftop companies to ensure that we are able to put a simple storyline, which says 'as long as you have a rooftop solar, an EV makes sense for you'.'' Asked about guidance for passenger EV sales, considering the company missed the target of 1 lakh in FY24, Balaji said, ''In the current year, we definitely want to exceed the 1,00,000 units, we are confident of doing so''. In FY24, Tata Motors sold 73,800 passenger EVs, up 48 per cent from FY23.

On whether JLR would apply for incentives under India's new EV policy, Balaji said, ''All options are on the table...We will consider what are the most effective options to work with, and we will execute that. Once we are clear on our plans, we will definitely share our plans''. As per the policy, the companies that would set up manufacturing facilities for EV passenger cars will be allowed to import a limited number of cars at lower customs/ import duty of 15 per cent on vehicles costing USD 35,000 and above for a period of five years from the date of issuance of the approval letter by the government.

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