In a recent analyst call, Tata Motors Passenger Vehicles Managing Director, Shailesh Chandra, indicated that the growth of the domestic passenger vehicle industry is likely to moderate to less than 5% in the next fiscal year. This projection follows a robust 25% growth in the fiscal year 2023, with expectations of an 8% growth rate in FY24. Chandra attributes this moderation to the high base effect, anticipating a slightly challenging FY25 for the industry.
Despite the anticipated slowdown in traditional passenger vehicle sales, Tata Motors remains optimistic about the electric vehicle (EV) segment. Chandra acknowledged the challenges posed by the slow development of charging infrastructure in the country but emphasized that the company expects the momentum in EV sales to continue.
Chandra highlighted that in 2023, while the overall passenger vehicle industry recorded an 8% YoY growth, EV sales experienced an impressive surge of 95 to 100%. He anticipates this trend to persist, especially for companies with robust portfolios in Compressed Natural Gas (CNG) and EVs.
One of the primary hurdles for EV adoption, as noted by Chandra, is the lagging pace of charging infrastructure growth compared to the rapidly increasing adoption of electric vehicles. Tata Motors has taken an open collaboration approach to address this challenge, working with charge point operators and oil marketing companies to expand the charging infrastructure network. Additionally, the automaker plans to enhance its exclusive sales network for electric vehicles, with a strategic focus on expanding beyond the existing outlets in Gurugram.
While commodity prices have remained stable in recent quarters, Chandra acknowledged the potential risk of certain items experiencing price hikes in the future. Tata Motors is closely monitoring this situation as it could impact the overall dynamics of the automotive industry.
