EVs to account for 25% of Tata Motors’ PV sales: N Chandrasekaran
A fourth of Tata Motors total passenger vehicle sales will be accounted for by electric vehicles, as the company seeks to ride on the electrification trend in the country. The Tata Group flagship will announce fundraising plans to support the EV business, N Chandrasekaran, chairman Tata Motors told the shareholders at the company’s 76th Annual General Meeting (AGM) on Friday.
EVs presently account for 2 per cent of the company’s total passenger vehicle sales. Meanwhile, multiple shareholders expressed concern over non-payment of dividend, high debt levels and steep losses incurred by the company on account of UK subsidiary, Jaguar Land Rover Automotive Plc, during the two and half hours long virtual (AGM)
“Tata Motors has a very ambitious goal for EVs. We have planned at least 25 per cent of our total PV sales to come from electric in the medium to long term. We will launch 10 EV models by 2025. Towards this we will also raise capital at an appropriate time. Tata Motors is also looking to set up a battery plant outside Tata Motors.
Meanwhile, the plans are also afoot to set up 10,000 charging points in 25 cities with Tata Power in the coming years, he said. The company is also working on hydrogen fuel cell technology. It has seven hydrogen buses ready and got the first order of 15 buses from Indian Oil Corp, Chandrasekaran informed the stockholders.
“Within PV, the performance of the EV business is particularly noteworthy. We strengthened our market leadership to 71.4 percent led by sales of more than 4000 Nexon EV units since its launch last year. EV penetration has now doubled to 2 percent of our overall PV volumes. Overall PV volumes grew by a robust 69 per cent, even as the overall industry volumes reduced by 2 per cent while within that EV volumes grew 218 per cent,” he said.
During the 150-minute long virtual AGM, multiple shareholders expressed concern over non-payment of dividend, high debt levels and steep losses incurred by the company on account of UK subsidiary, Jaguar Land Rover Automotive Plc, This is the fifth straight year for which the maker of Safari and Harrier models has failed to pay dividend. It had a good track record till FY16.
“For senior citizens like us, income from the bank and dividend income are the only sources of livelihood,” said an aggrieved shareholder. In his response Chandrasekaran said, “We understand your concerns and we hope to become a dividend paying company very soon.”
At the end of FY21, Tata Motors’ net automotive debt stood at Rs 40,876 crore, down from Rs48,282 crore a year ago. “We are on track to reduce to achieve net zero auto debt in three years,” said Chandrasekaran, assuaging shareholders’ concerns.
It will be done through a combination of operational cash flow and monetization of non-core assets, he said. Net loss at the consolidated entity at the end of FY21 widened to Rs 13,395 crore from Rs 11,975 crore in the previous fiscal.
In response to a question on the chip shortage and its impact on the overall business, Chandrasekaran said he expects the supply related issues to get resolved by the second half of the current year. Meanwhile, he assured the shareholders that the impairments are behind and that it’s unlikely there will be more impairment in the coming years.
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