By 2027, Tata Motors aims to offer ten electric vehicle models. Their strategy of blending converted internal combustion engine (ICE) vehicles and dedicated electric vehicles (EVs) is designed to optimize value until the EV market gains significant traction.
Tata Motors intends to merge Gen 2 electric vehicles, which are conversions of internal combustion engines, with offerings from its dedicated EV platform, Avinya, to target the EV market, according to Shailesh Chandra, MD of Tata Motors Passenger Vehicles and Tata Passenger Electric Mobility.
Additionally, Tata Motors is developing a 1.5-litre petrol engine for its upscale SUVs to fill a gap in its lineup. The company recently introduced the updated Safari and Harrier with starting prices of INR 16.19 lakh and INR 15.49 lakh, respectively.
Chandra mentioned that the new Safari and Harrier help fill some voids in their luxury SUV lineup, and they plan to expand their petrol offerings in this segment. The upcoming petrol engine will be introduced after a year and featured in models like the Harrier, Safari, and Sierra.
Given that 20% of the luxury SUV market, approximately 3,000 units annually, now prefers petrol, the 1.5-litre turbo petrol engine has become essential. The luxury SUV segment has expanded to 16,000 units and is projected to reach 25,000-30,000 soon. Tata Motors’ more affordable range already includes petrol variants.
Regarding their EV strategy, Tata Motors aims to launch the Sierra Gen 2 EV in 2025, with the Harrier SUV and Curvv Coupe EV models arriving in 2024. These will complement Tata Passenger Electric Mobility’s existing lineup, which includes the Tiago EV, Nexon EV, Tigor EV, and the Xpress TEV commercial vehicle.
Chandra stated that the Avinya platform will give rise to several dedicated EV offerings. By 2027, Tata Motors aims to have ten electric vehicles in its lineup. The company’s blending ICE conversions with dedicated EVs aims to optimize value until the EV segment gains traction.
Chandra pointed out that while dedicated EVs demand significant investments, they don’t always offer a compelling value proposition for consumers. With Gen 2 conversion models, Tata Motors will adjust the existing design and modify the floor space to fit more batteries. Tata Motors’ EV offerings will be of the Gen 2 variety for the upcoming three years. The shift to dedicated EVs will occur when the market grows, and battery costs decrease, but the company will be prepared with the necessary infrastructure.
This strategy allows Tata Motors to offer both types of vehicles without the financial burden of a dedicated EV lineup impacting its profit and loss statement.
Regarding funding, Tata Passenger Electric Mobility requires USD 2 billion for its 10-product range. They’ve secured USD 1 billion from TPG and plan to use internal funds while also exploring other fundraising avenues for the remaining amount.