CNG under active evaluation as demand scales up; hybrids to be considered reactively based on competitiveness and segment dynamics.
14 Nov 2025 | 4232 Views | By Ketan Thakkar & Prerna Lidhoo
Tata Motors Passenger Vehicles Ltd is evaluating both CNG and strong hybrid powertrains for its larger cars and SUVs, signalling a calibrated diversification of its propulsion strategy beyond the sub-4-metre space at a time when the industry is seeing a sharp shift towards lower running-cost powertrains and tighter fuel-efficiency norms ...
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Tata Motors Passenger Vehicles Ltd is evaluating both CNG and strong hybrid powertrains for its larger cars and SUVs, signalling a calibrated diversification of its propulsion strategy beyond the sub-4-metre space at a time when the industry is seeing a sharp shift towards lower running-cost powertrains and tighter fuel-efficiency norms under CAFE 3.
The move comes as rival Maruti Suzuki has expanded CNG into the premium segment with models such as the Victoris, which features an underbody CNG, demonstrating growing customer acceptance for CNG in larger SUVs.
Tata Motors’ own momentum in the alternative-fuel segment has strengthened sharply. The company sold over 1.2 lakh CNG vehicles in CY2024, and volumes are inching towards 1.5 lakh units this calendar year, reinforcing the business case for extending CNG beyond compact cars.
During the Q2 FY26 earnings call, Tata Motors Passenger Vehicles MD & CEO Shailesh Chandra confirmed that the expansion of CNG into the >4m category is under active consideration.
Chandra said, “We go with CNG for all the cars which are less than 4 metres… but we are also very closely watching the 4.3-metre segment. Potentially, if we see demand there, we might extend our portfolio of CNG offerings in that segment also.”
The widening interest in CNG comes amid a market environment where mid-size buyers are increasingly turning to low-TCO options, driven by high petrol costs, shrinking diesel demand, and greater urban-commute requirements.
In contrast, strong hybrids remain a reactive and competitiveness-led option for Tata Motors.
Chandra said, “The hybrid, as I said, is reactive… we will study the market more from a competitiveness perspective. The obvious segments to look at would be the higher, bigger cars to start with.”
He added that while Tata Motors is technologically prepared, hybridisation remains in the evaluation phase: “This is all right now in the phase of study and strategy… from a tech-readiness perspective, we are confident and ready for that.”
Clarifying the category under consideration, Chandra said, “Yeah, it will be greater than 4-metre cars.”
With rising CNG penetration, hybrid traction growing in the >4m SUV/MPV space, and Tata Motors’ strong EV portfolio, the company is shaping a flexible, multi-powertrain strategy aligned with evolving consumer economics, regulatory tightening, and competitive pressures to help bring in incremental sales.