Expect demand for electric CV to remain strong: Tata Motors MD & CEO

Tata Motors anticipates sustained and further growth in demand for its electric commercial vehicles (CVs), according to Managing Director and CEO Girish Wagh. This outlook is bolstered by a robust order book spanning multiple segments, as reported to analysts. The company achieved over 3,400 electric CV orders in the first quarter of the fiscal year, continuing the upward trajectory observed in the latter half of the previous year.

Wagh also expressed confidence in the prospects of government initiatives such as PM-eBus Sewa, which could present additional opportunities for the automaker. The electric small commercial vehicle (SCV) pickup, sold exclusively through the retail market, is currently proving popular, contributing to the overall positive demand trend.

A key factor behind the strong performance of Tata Motors' electric models, such as the Intra and Ace Pro, is their improving total cost of ownership (TCO) compared to their internal combustion engine (ICE) counterparts, Wagh explained. As TCO parity becomes more advantageous, consumer demand is expected to remain robust and continue to grow.

Regarding supply constraints, Wagh clarified that Tata Motors' own manufacturing capacity was not limiting the production of electric vehicles. However, the bottleneck arose from the limited availability of battery cells imported from China. While the company's internal production capacity poses no issue, the surge in EV demand has led to a cascading increase in cell demand from China, further exacerbated by the rising share of electric vehicles within the Chinese market.

This increased demand for cells has created supply chain issues, causing delays in sourcing, transporting, and converting cells into batteries. To mitigate these challenges, Tata Motors has already placed significant orders for cells, which should alleviate the bottleneck by the end of the current quarter, according to Wagh.