Automaker says long-term EV progress takes priority as entry segment remains toughest to electrify
20 Feb 2026 | 90 Views | By Darshan Nakhwa, Prerna Lidhoo and Ketan Thakkar
Tata Motors Passenger Vehicles Ltd has sacrificed margins to some extent on electric vehicles to accelerate mainstream adoption and support long-term growth, said a senior copany official ahead of the launch of the new Punch.ev.
“Right now, we have to sacrifice our margins to some extent to ensure that ...
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Tata Motors Passenger Vehicles Ltd has sacrificed margins to some extent on electric vehicles to accelerate mainstream adoption and support long-term growth, said a senior copany official ahead of the launch of the new Punch.ev.
“Right now, we have to sacrifice our margins to some extent to ensure that there is a long-term progress being made towards electric vehicles,” Shailesh Chandra, MD and CEO of Tata Motors Passenger Vehicles said.
Despite the margin pressure, Chandra said the EV business remains close to the profitability levels of the company’s internal-combustion passenger-vehicle operations. “We have been sharing our profitability numbers with the market and we are not very far away from the PV ICE business,” he said.
He added that discounting in the EV market is broadly in line with trends seen in ICE vehicles and reflects overall market conditions rather than structural weakness in EV demand.
According to Chandra, the domestic EV market has evolved significantly in recent years. What was once seen as experimental technology is now increasingly viewed as a serious alternative to internal combustion engine (ICE) vehicles in several segments.
“In certain segments, it is now being considered pretty much similar to an ICE vehicle,” he said, pointing to strong acceptance in higher-priced SUVs.
He said barriers around price, battery life and charging convenience are gradually being addressed, especially in mid and premium segments where EVs are approaching price parity and offering higher range and lifetime battery warranties.
“Once you overcome those barriers, then the proposition of EV becomes very compelling and that is being understood in certain segments,” Chandra said.
EV sales in India have grown sharply from a few thousand units annually several years ago to around 200,000 units expected this financial year. The entry of most major carmakers into EVs signals growing confidence in the technology, he said.
“All the top six players have entered electric vehicles. That itself shows that even the last set of players have gone serious about it,” he said.
“More competition coming into the space… is going to only be beneficial to the overall mission of electrification of the country,” Chandra said, adding this will help expand the market rather than hurt Tata Motors’ prospects.
Tata Motors will continue to focus on expanding product choices, improving value proposition and strengthening charging infrastructure through partnerships and investments, he said.
The company has been working with charge point operators, residential societies and other stakeholders to expand home, community and highway charging.
“Our pathway is to give width of choices to customers and keep strengthening the value proposition of each model,” he said.
Chandra added that as the EV market expands, Tata Motors aims to grow alongside it and maintain momentum in adoption.
Competition in India’s electric passenger-vehicle market has intensified over the past two years, with Mahindra, JSW MG Motor India, Hyundai Motor India and Maruti Suzuki stepping up investments and launching new products. Tata Motors remains the market leader by a wide margin, having built early scale and a strong charging ecosystem, but its market share has moderated as new models from rivals have entered the market and broadened consumer choice.
In the first 10 months of FY26, electric PV sales in India rose to about 160,762 units, up 48% year-on-year from 108,820 units in the same period last year. With an estimated 35,000-plus units likely to be sold in the final two months of the fiscal, total volumes for FY26 could approach the 200,000-unit mark for the first time.
Chandra said the real challenge for EV adoption lies in the entry-level segment, which accounts for about 65% of total passenger vehicle sales but has very low EV penetration.
The economics of offering high battery capacity and range at lower price points make the segment difficult to crack. Companies must invest heavily in cost reduction and localisation to make EVs viable.
“This is where you’ll have to really work a lot on cost reduction, cost optimization while giving range at a level which is palatable to customers to own this as a single car,” he said.
He said the new Punch.ev is a critical step in addressing this gap and pushing EV adoption in the mainstream market. “Until we don’t crack this, we will not be able to mainstream EVs and that’s why Punch EV becomes one of the critical launches in the journey of the progress and evolution of electric vehicles in India,” he said.
Currently, Tata Motors PV offers six electric vehicles in India, and is expected to add Sierra EV to its portfolio in the coming months.