Tata Motors, the Indian multinational automotive manufacturer, expects that the passenger vehicle industry growth will reduce to 5-7 percent this year. According to Shailesh Chandra, the managing director of Passenger Vehicle and Electric Vehicles at Tata Motors, pent-up demand in the passenger vehicle segment has decreased, with fewer new launches in popular sports utility vehicle segments. Last year, the auto industry witnessed a sales growth of 27 percent due to pent-up demand and low inventory levels. However, the growth is expected to slow down this year due to the RDE (real driving emissions) transition, leading to increased vehicle prices.
To sustain growth this fiscal year, Tata Motors is planning to introduce new products, including CNG and electric models, and improving its existing portfolio with new interventions. The auto major is looking to drive margin improvement through an institutionalized cost-reduction initiative. It is expected to benefit from expanding its portfolio in the CNG and electric vehicle segments, with both anticipated to see good growth this year.
Tata Motors reported its best-ever year in terms of dispatches to dealers at around 5.4 lakh units last fiscal year. The company’s wholesales grew about 45 percent year-on-year, as compared to FY22. Chandra said that to sustain its volumes and market share, the company plans to add new nameplates, including Curvv and Sierra.
Tata Motors is optimistic about its CNG variant of Punch, which it claims to offer a unique twin-cylinder technology. It also plans to introduce electric vehicles this year, which increase EV volumes steeply. The company is focusing on demand generation through micro-market focus and boosting conversion rates. Chandra noted that beyond this financial year, the growth rate of the passenger vehicle industry is expected to return to the double-digit numbers.
