Tata Motors aims to sell 50,000 units of electric vehicles (EVs) this financial year and double it to 100,000 units in the next fiscal, even as it is working on all fronts to counter chip shortage. The Tata group company, which expects the second half of FY23 to be “notably better” than the first half, expects to sell overall 500,000 cars in this financial year.
Tata Motors sold less than 1,000 EVs in FY20, less than 5,000 in FY21 and 19,500 in FY22, chairman N Chandrasekaran told shareholders at the company’s annual general meeting (AGM), held virtually, on Monday.
“We are determined to increase our EV sales as percentage of the overall sales at a very significant rate. We are on an aggressive growth path and safety is a very important element for us, so we definitely want to ensure that there are no accidents and EVs provide excellent safety features,” Chandrasekaran said in its reply to shareholders.
About 7.4% of the vehicles Tata Motors sells are EVs, and this would go to 58-60% “but it will take time”. It also plans to expand its EV portfolio to 10 vehicles by 2025. However, the company has no “interest” in EV scooters or bikes.
The company has hit a monthly sales run rate of 45,000 units as market conditions have started improving, and will cross the half-million mark in sales this fiscal. It will also ramp up production capacity, while the takeover of Ford’s facility in Sanand, Gujarat, will help it add “significant” production capacity.
On Tata Auto Components, Chandrasekaran said it has improved on parameters and turned profitable.
Terming the fire in a Nexon EV in Mumbai last month a “one-off” incident, he said a dedicated team is going into the entire technology to see why it occurred, adding “we are determined to ensure such things don’t happen”.
On the semiconductor issue, he said the company is working with all suppliers and chip companies for a permanent solution, and “we are making good progress”.
Tata as a group is committed to make investments in the north-east. For example, Indian Hotels Company is planning to open at least 10-15 hotels in the region, he said.
Chandrasekaran said the EV version of the popular mini truck Ace received about 40,000 orders at its launch. The group is creating a large network of charging stations, apart from providing home-charging and ensuring supply of spare parts.
“We are working aggressively towards making both Tata Motors’ commercial vehicles and passenger vehicles businesses profitable at the PBT level, not only at the EBIT level, but also cash-flow positive. Similar targets are there for Jaguar Land Rover. Our desire is that all the three units are EBIT, PBT and cash-flow positive,” he said.
“The demand for our vehicles in each of our businesses — JLR, CV and PV — remains strong despite ongoing geopolitical, supply and inflation concerns. The overall supply situation, including that of semiconductors, is gradually improving and commodity prices are stabilising. We continue to work closely with our customers and ecosystem partners to mitigate risks and manage uncertainties.”
“Accordingly, we expect performance to progressively improve through the year with the second half of FY23 being notably better than the first half,” he added.
Tata Motors Group aims to be net zero in emissions by 2039 for JLR, for PVs by 2040 and CVs by 2045, he added. Tata Motors will be spending about `32,000 crore as capex inFY23, compared with`23,000 crore in FY22.