Going Mainstream?: An EV is the First Car for Over 25% of Tata Passenger Electric Mobility Customers

The domestic electric passenger vehicle (PV) segment may still be niche, with only around 5 per cent share in the overall PV market, but for Tata Motors it’s reached 17 per cent for the current quarter, which it says is also a reflection of the new technology gradually going mainstream. Anand Kulkarni, Chief Products Officer, Tata Passenger Electric Mobility (TPEM) says that around 26 per cent of TPEM’s customers are first-time car buyers.

Also read: Tata Goes Offensive on EVs with ₹16,000–18,000 Crore Investment Plan

The EV maker, which announced crossing the 250,000 sales mark on Tuesday, reports that 84 per cent of its customers use a Tata EV as their primary car. Officials say that internal study shows that Tata EV customers clock around 45 per cent more kilometres, compared to Tata ICE vehicle customers. While the ICE vehicle customers clock an average of 1,000/1,100 kilometres, the EV owners clock an average of 1,600 kilometres every month.

The lower cost of running in an EV is seen as the major factor for this trend. “It’s like the digital camera moment”, says a Tata official, using the analogy of the difference in usage patterns of traditional film cameras and digital cameras when taking pictures in the latter hardly cost the user anything.

Also read: Tata Confirms Avinya EV Launch Next Year, Dedicated Sales Network Planned

Portfolio Expansion

From around 2,000 units in annual sales about six years ago, to the figure growing to 200,000 now, the electric PV segment has come a long way. TPEM has sold around 60,000 EVs so far during this financial year, and expects to reach a level of 80,000 - 90,000 units by March ‘26. The next financial year will be crucial, not so much because of reaching the 100,000 mark in annual sales, but because the EV OEM will add at least three offerings – Sierra EV, Punch EV facelift, and the new brand Avinya.

A new platform will be introduced in FY27. With all the new interventions planned, TPEM is bullish to have a “steady state” market share of 45-50 per cent in the EV space. Shailesh Chandra, MD & CEO, Tata Motors Passenger Vehicles says that the ICE-EV price parity has been achieved in the vehicle segment of ₹20 lakh and above, and there’s “reasonable confidence” to meet the price parity in the ₹12 lakh - 20 lakh segment. Tata’s best-seller Nexon EV sits in this category.

The bigger challenge is to meet the price parity in the entry level segment with models like the Tiago EV (Tata’s second highest selling EV), Punch EV, primarily because of the price points they sit in. What has added to the challenge is the widened price gap between the ICE and EV versions, triggered by reduced GST for ICE vehicles.

“We could have achieved the price parity, and 400 kilometre range faster than what we can achieve now,” says Chandra in a Press Conference. He also adds that the “good news” (for EVs) is that the regulation driven costs will lead to ICE vehicles becoming costlier, and that will also help address the price-parity challenge for the smaller vehicles.

Open to Collaboration

Even as Tata sees some good gains as an early mover in the emerging electric passenger vehicle market, at the industry level it’s still not an impressive story for the new propulsion technology. The electrification megatrend has also triggered an accelerated trend of collaboration. Chandra says that hypothetically speaking, Tata Motors Passenger Vehicles will be open to collaborate provided there’s good mutual benefits. “Collaboration is definitely an imperative”, he says.

For now, it’s a solo ride for Tata in the EV space, and it wants to have more industry peers join the EV game for the industry to reach the much needed critical scale. For its part, Tata has plans to invest ₹16,000 crore - 18,000 crore between FY25 and FY30, for its new model programmes as well as for new versions of its existing models.