According to a top corporate executive, Tata Motors is seeking to boost the number of its sales locations in Tier II and Tier III cities in order to meet the growing demand for its electric model line in these areas.
Tata Motors, which sold over 19,000 electric car units at the end of the first quarter, is also aiming to develop a unique sales infrastructure for its electric vehicle portfolio in the future. Shailesh Chandra, managing director of Tata Motors Passenger Vehicles, stated during an analyst call that EV usage is now expanding outside of the top 20 cities in the nation.
Regarding how EV sales will develop from here, he said, “With the bias now moving to other parts of the country, that’s a good sign.” According to Chandra, there has been a change in the micromarkets since the introduction of the Tiago EV. In addition, he pointed out that outside of the top 20 cities, sales of the Tiago EV already account for more than 49% of total sales.
And so, using the shop-in-shop model, we’ve seized the chance to really begin building out our network in those smaller areas. As we grow in these places, we also develop the infrastructure for the service capabilities and educate the service engineers who will work at those service stations. Thus, that is likewise a continuing process, according to Chandra.
He added that the business might consider dividing the EV showrooms from the current sales locations in order to serve clients from all across the nation. In order to market EV products, Tata Motors now uses a shop-in-shop strategy in its current dealers.
In the future, he continued, “We also want to separate ICE as well as the EV showrooms, as and when we see the volumes in certain cities go to a certain level where the separate channel becomes viable.”
Tata Motors’ cause for changing sales strategy
Chandra stated that increased localization efforts and lower costs of new-generation aggregates will lead to a considerable margin improvement for Tata Motors in the EV market. Additionally, he continued, the Tiago EV’s production-linked incentive (PLI) programme and the decline in battery cell prices will contribute to the overall expansion of the EV market.
“Cell costs are returning to their pre-H1 levels, and effects should start to be felt as early as this quarter…PLI will significantly increase the margin, and we are convinced that we are meeting all eligibility conditions established by the ministry (of heavy industries), Chandra stated.
According to him, Tata Motors has been working on localization for the past two years, and doing so will result in significant cost savings. New generation aggregates will also be available this fiscal year and are priced much more affordably. Therefore, I have every confidence that the forecast for the EV business will be quite positive over the medium term, specifically this year, given the combination of all of these elements, Chandra added.
This year, Tata Motors hopes to sell about 1 lakh EVs.
