Tata Motors to invest up to Rs 35,000 crore in passenger vehicle business in 5 years
Tata Motors
has earmarked an investment of ₹33,000-35,000 crore in its passenger vehicle (PV) business, including the electric vehicle arm, over the next five years, the company said in an investor presentation on Monday.
The investment will go towards expanding the Tata Group company's products, integrating next-generation technologies and improving profitability. The capex plan includes ₹16,000-18,000 crore earmarked specifically for the EV business between FY25 and FY30.
The maker of the Nexon and Safari SUVs plans to launch 30 models by the end of the decade. This will include seven all-new nameplates and 23 product refreshes, expanding its portfolio from the current eight models to over 15 across multiple powertrains. These products will include fossil-fuel driven vehicles, electrical vehicles and future-ready platforms, including one under the Sierra brand and two under its upcoming Avinya EV range, the company said in the presentation.
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With the investment, Tata Motors aims to increase its passenger vehicle market share to 16% by FY27 and expand it further to 18-20% by FY30 from 13.2% in FY25. The company envisages EVs to account for a fifth of its PV volumes by FY27 and 30% by FY30.
Tata's PV business, which reported revenue of ₹48,400 crore in FY25, will allocate 6-8% of its annual turnover towards capital expenditure over the investment period. The company expects to improve its PV EBITDA margin to more than 10% by FY30 from from 6.9% in FY24, driven by a stronger product mix, scale benefits and material cost reduction. The EV division turned operationally profitable in FY25, a year ahead of its FY26 target, benefiting from high localisation, aggressive cost control and incentives under the government's production-linked incentive (PLI) scheme. The company has accrued ₹250 crore in PLI benefits for FY25, up from ₹102 crore in FY24.
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Tata Motors is in the process of demerging its PV and commercial vehicle businesses into two listed entities. The restructured PV unit will house both Tata PV and Jaguar Land Rover businesses and operate under the name Tata Motors Passenger Vehicles. The demerger is expected to be completed by the end of 2025.
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