India's third-largest carmaker commands 96 percent of the country's electric car market. With its first-mover advantage, it is only likely to benefit once the momentum gathers pace and investments pour in
It’s now safe to assume that Tata Motors holds a distinct advantage in India’s electric vehicle (EV) transformation journey.Much of that, of course, is thanks to the Nexon EV launched in 2020, which has gone on to become a runaway success with sales of nearly 20,000 units so far. The Nexon EV is based on the Nexon SUV, once built as a bridge product to keep the automakers' coffers flowing when it transitioned its entire vehicle platforms on two new architectures as part of the automaker’s restructuring after a decade of turmoil.Today, Tata Motors is India’s third-largest carmaker, with a market share of nearly 14 percent, and is closely on the tail of India’s second-largest carmaker, Hyundai Motors. More importantly, the success of the EV has meant that the company commands a staggering 96 percent of India’s electric car market. Of course, EVs are in their infancy in India, and lag markets like China and the US, as domestic sales fare pale in comparison to what carmakers sell on the internal combustion engine (ICE) platforms. The EV sector penetration in the country currently stands at around one percent and that’s particularly why Tata, with its first-mover advantage, is only likely to benefit once the transformation gathers pace, pushed by private and public investments into the sector. That’s precisely why, on May 11, a week after the company showcased its third-generation electric concept vehicle, Avinya, which could have a range in excess of 500 km and is envisioned as a global product that can rival even Tesla, Tata decided to bring in its latest offering, the long-range Nexon EV, that the automaker reckons will allay range fears.Also Read: Not just Tata Motors, Mahindra too has now built India's most valuable electric vehicle companyThe Nexon EV Max boasts an ARAI range of 437 km, almost 120 km more than the electric Nexon currently on sale. The figure is under optimal conditions and that would mean that the real-world number could be different, most likely be about 30 percent lower. The new upgraded EV has a larger 40.5 kWh lithium-ion battery pack, offering a 33 percent higher battery capacity. The automaker has also offered a faster charging time of 0–80 percent in 56 minutes from a 50 kW DC fast charger.The Nexon EV Max is priced at Rs 17,74,000 and goes up to Rs 19,24,000, while the Nexon EV is priced between Rs 14,50,000 and Rs 17,15,000. “This vehicle has the potential to be a game changer,” says Puneet Gupta, director for automotive forecasting at market research firm S&P Global Mobility. “This will be a trendsetter for all the companies who are going to bring in their electric vehicles, and from a customer perspective, that means the Nexon could now be the first choice for buyers as it addresses the issue of range anxiety. For long, the Nexon EV was a second vehicle for buyers, especially in cities.”While the new variant is more expensive, it also undercuts its competitors, particularly MG Motors and Hyundai Motors, whose electric offerings remain significantly more expensive, a hindrance to the wider adoption of EVs. For instance, the top variant of the Hyundai Kona costs Rs24 lakh while the MG ZS costs nearly Rs26 lakh. “We did a survey, and it came out that the minimum range that a customer is looking for to avoid range anxiety is 200 km,” Shailesh Chandra, president of Tata Motors passenger vehicles, told Forbes India in November 2021. “That means a certified range has to go above 300 km or so. At the same time, the customer is not willing to give more than 25 percent premium over ICE vehicles.” That focus on pricing, coupled with a fixation on the product quality, is precisely how the Tatas seem to have cracked the Indian electric market. Last year, the EV space collectively saw a 257 percent year-on-year growth with Tata Motors registering the highest sales, with over 3,324 vehicles, posting a staggering 331 percent growth in the passenger EV segment. “The new long-range variant is an absolute winner and should allay the range anxiety concerns if any for the fence-sitters,” Harshvardhan Sharma, head of auto retail practice at Nomura Research Institute, says. “This will surely fortify Tata Motors’ apex position in the Indian EV market.” Already, the company has set up a subsidiary, Tata Passenger Electric Mobility Limited, for its EV play and turned that into India’s most valuable EV company, after raising $1 billion from private equity major TPG Rise Climate. The deal values the subsidiary at over $9 billion and the first tranche of capital infusion had taken place in March. Tata Motors will also invest $2 billion into the subsidiary over the next five years.“Our goal is to go global eventually and we are benchmarking to be the best whether it is in terms of software, electric and electronic architecture or the intuitive experience,” N Chandrasekaran, chairman of Tata Motors, had said on April 29 in Mumbai, at the launch of the company’s third-generation EV. “We have really high aspirations. EVs open up a whole new set of possibilities for the company.”