Tata Motors plans to ramp up EV production as demand spikes

Tata Motors is looking to ramp up the production of electric vehicles as demand continues to outpace the manufacturing activity by a huge margin, according to a top company official.

The Mumbai-based automaker, which led the passenger electric vehicle space in the domestic market in last fiscal year, has been receiving an average of 5,500-6,000 bookings in the past two months for its EV range. The company sells three electric products — Nexon EV, Tigor EV and XPRES-T — in the domestic market. It has also recently unveiled a coupe style SUV which it plans to launch in the next two years.

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In an interaction with PTI, Tata Motors Managing Director Passenger Vehicle and Electric Vehicles Shailesh Chandra noted that huge demand for its EV range has led to a backlog of customer orders. “We are seeing that the demand is significantly outpacing the supply. The numbers are just the ones which we are able to supply, the demand is definitely much stronger which is reflected in the number of bookings with us,” he said when asked about the EV demand scenario.

The acceptance of EVs is there, in the last one-two months, the company has been getting an average of 5,500-6,000 bookings per month, he added. The company, however, was able to supply just around 3,300-3,400 units last month, Chandra said. “So every month there is a backlog (of orders) for us,” he stated.

Chandra noted that the company is trying to ramp up the capacities by increasing the sourcing of semiconductors. The company has initiated various steps like design modifications as well as sourcing from multiple vendors to increase the availability of the essential semiconductors. “These steps have allowed us to significantly ramp up production. Just seven months ago we were producing just 600 units but then such actions have helped us to increase it to 1,500-1,700 levels and then 3,000-3500 levels. This will continue,” Chandra said.

When asked about sales aspirations for this year, Chandra stated: “Last year, we grew by five folds, and therefore the aspiration would be definitely to grow not in increments but in multiples.” As per FADA, Tata Motors led the electric passenger vehicle segment in 2021-22 with retails of 15,198 units and a market share of 85.37 per cent in the vertical.

When asked if electric vehicles sales could account for 30 per cent of overall passenger vehicle sales by 2030, Chandra noted: “I would believe that the demand can be significantly higher than 30 per cent level because when the inflection point is hit then the growth is absolutely uncontrollable.”

The main factors which will limit the growth will be the pace of supply ramp-up and capacity and ecosystem development, he added. “From a demand perspective, we have seen it shot up in no time. Despite various ramp-ups, we are still not able to meet the demand. So the demand will definitely, we believe, go beyond this 30 per cent mark,” Chandra noted.