Budget 2026: Tata Motors advocates for incentives on entry-level EVs
What's the story
Ahead of the Union Budget 2026, Tata Motors has urged the government to consider fiscal support for entry-level electric vehicles (EVs). The company's Managing Director and CEO of Passenger Vehicles, Shailesh Chandra, emphasized this need during a recent interaction with PTI. He highlighted that while policy measures have revived demand in the broader passenger vehicle market, entry-level EVs are still struggling due to changing price dynamics.
Policy impact
Government's role in reviving PV industry
Chandra appreciated the government's role in reviving both the passenger vehicle and electric vehicle sectors. He suggested that targeted incentives could be considered for entry-level EVs in light of affordability pressures. He also noted that recent GST reforms have made petrol-powered cars cheaper, putting additional pressure on entry-level EVs and affecting their value proposition for cost-sensitive consumers.
Fleet focus
Fleet segment's contribution to mobility
Chandra also highlighted the fleet segment's contribution to mobility, despite its small share in vehicle sales. He said electric cars used by fleets only account for about 7% of total passenger vehicle volumes but contribute nearly 33-35% of passenger kilometers. He noted that while fleet EVs were supported under the earlier FAME-II program, they haven't been included under the PM E-DRIVE scheme so far.
Cost challenges
Tata Motors grapples with cost pressures
On the pricing front, Chandra said Tata Motors is dealing with cost pressures from currency fluctuations and higher commodity prices. He said these factors have impacted revenues by around 2%. While the company has absorbed these costs so far, it may have to pass on some of this burden to consumers in the future.