How Tata Motors plans to make EV business profitable
What's the story
Tata Motors Passenger Vehicles (TMPV) is gearing up to make its electric vehicle (EV) business profitable even after government subsidies are gone. The company has unveiled a plan to achieve this through aggressive cost-cutting measures, localization, and a much larger product portfolio. At the recent Passenger Vehicle Investor Day, Tata Motors detailed its strategy for improving EV profitability through structural cost interventions across battery packs, electric drive systems, power electronics, and other high-voltage components.
Financial progress
EV business nearing EBITDA breakeven
Tata Motors' EV business is nearing an EBITDA breakeven, excluding PLI benefits. The company expects margins to improve steadily through a combination of scale, product mix improvements, cost optimization and pricing actions. By the end of the decade, Tata Motors expects its EV profitability to move closer to parity with internal combustion engine (ICE) vehicles. This transition will be supported by a major technology and product expansion plan.
Tech evolution
Plans to improve battery technology
Tata Motors has unveiled a roadmap to improve its EV battery technology from the current 30 kWh range to packs over 75 kWh. This will allow for much longer driving ranges and faster charging capabilities. The company's sales figures show a 24% growth in FY26 with around 92,000 electric vehicles sold, capturing over 40% of the domestic EV passenger vehicle market share.
Expansion plans
EV market and Tata Motors' growth expectations
The overall passenger vehicle EV industry ended FY26 at around 220,000 units. Tata Motors expects this segment to grow to 1-1.1 million units by FY31, with EV penetration reaching 15-20% of the market. The company also plans to widen its EV lineup from six models currently to 10 by FY31, including four new launches and over 10 product refreshes during this period.
Market strategy
Measures to reduce dependence on imported components
Tata Motors plans to localize critical EV components, consolidate power electronics across models, optimize battery-pack design, and drive greater integration of high-voltage systems. These measures are expected to reduce dependence on imported components while improving margins and supply-chain resilience. The company noted that EV adoption in India has moved beyond early adopters into the early-majority phase, requiring manufacturers to address concerns around pricing, real-world range, charging speed among others.