Tata Motors has begun a two-and-a-half-year programme to prepare for entry into the UK passenger vehicle market, as the company positions itself for opportunities under the India-UK Comprehensive Economic and Trade Agreement (CETA).
The preparations come ahead of the implementation of the trade agreement, which provides phased market access for Indian-built electric vehicles through a quota system.
"We are starting to tap that market opportunity," Shailesh Chandra, Managing Director and CEO of Tata Motors Passenger Vehicles, told reporters on the sidelines of the Sierra EV launch on Tuesday. "The go-to-market plan itself requires about two to two-and-a-half years of work, and that process has now begun."
Chandra said preparing for the UK market involves a lengthy process that includes vehicle certification, compliance with local regulations and establishing distribution and after-sales operations. He did not say when commercial sales would begin.
Under the trade agreement, tariffs will be eliminated on 99% of India's export basket. Passenger vehicles will be covered under a separate market access framework. Indian electric vehicle manufacturers will receive duty-free access to the UK through an annual quota beginning in the sixth year of the agreement. The quota will start at 17,600 vehicles a year and rise to 88,000 units annually by the fifteenth year.
The UK is expected to be among Tata Motors' first new passenger vehicle export markets. As a right-hand-drive market, it allows the company to adapt vehicles developed for India with fewer engineering changes than would be required for left-hand-drive markets.
The export plans come as Tata Motors expands its electric vehicle range. The company has launched the Sierra EV and is developing the Avinya range of premium electric vehicles.
Autocar Professional had earlier reported that the Avinya programme is being developed with a global market in view. The project has brought Tata Motors and Jaguar Land Rover closer together, with JLR contributing to areas including premium vehicle engineering and software development. Tata Motors has not disclosed which overseas markets will receive the Avinya models first.
The closer collaboration has also been reflected in the company's leadership structure. Earlier this year, Tata Motors appointed Balaje Rajan to lead corporate strategy, a role that includes strengthening coordination between Tata Motors and Jaguar Land Rover on future products and technologies.
At its Investor Day earlier this year, Tata Motors said it plans to increase annual passenger vehicle sales to more than 1.2 million units by FY31 while expanding its portfolio from nine to 15 nameplates. Exports are expected to play a bigger role in supporting that growth over the coming years.