Under the new EV subsidiary, Tata Motors will launch new electric cars with larger batteries which will be rolled out from the company’s existing facilities
Tata Motors recently made a big move towards cleaner mobility solutions as it announced the creation of a new EV subsidiary. The carmaker has entered into a partnership with investment firm TPG Rise Climate which will invest around Rs 7,500 crore for about 11 percent to 15 percent stake in the new company.
This translates to an equity valuation of USD 9.1 billion. The new EV vertical from Tata will create future intellectual property rights for zero-emission vehicles. This means the company will design and own future electric vehicle IPs while manufacturing operations will be taken care of by Tata Motors.
In addition to the above, Tata Motors will be investing another Rs 15,000 crores to launch new electric vehicles. Tata Motors is expecting green vehicles to generate 20% of their total sales in the next 4-5 years.
Tata Motors currently has only two electric cars on offer, Nexon EV and Tigor EV. These have monthly demand of about 3,000 units per month. But Tata is only able to manufacture 1,000 units per month. The new investments will not only help to boost production of existing EVs, but will also help launch new EVs.
New EV Subsidiary
Temporarily titled EVCo, the new firm won’t have any manufacturing facilities of its own and instead will depend on its parent company to roll out new electric vehicles. Manufacturing capacities of Tata Motors will be available “on a “tolling basis” to the EV firm. Further, it has been revealed that the new EV brand will have access to the passenger vehicle capacities of Tata Motors which already exists.
For utilising the PV facility of Tata, the new EV company will pay a fee to its parent company’s PV division. Tata Motors is currently the highest-selling EV manufacturer in the passenger vehicle segment in the country. It currently offers two electric cars- Nexon EV and Tigor EV. Both models will continue to be produced from their existing locations. The final brand name for EVCo will be finalised in the coming months.
New Tata Electric SUVs to be based on existing platforms
The homegrown manufacturer is not looking to develop EVs based on new born-electric platforms and instead is focusing on developing new EVs on existing platforms like ALFA (Altroz, Punch) and OMEGA (Harrier, Safari). The current EV lineup of Tata- Nexon EV and Tigor EV is underpinned by the Ziptron powertrain technology which is likely to feature in the upcoming EVs as well.
No Hybrids, Only Pure EVs
Tata Motors has also revealed that it plans to have ten electric vehicles in the next five years and all of them will be pure electric. The company has also ruled out hybrids as they do not help manufacturers meet CAFE norms. Moreover, the Government of India doesn’t consider hybrids as EVs and hence they are not liable to any tax benefits introduced as per FAME II regulations.
Therefore, it is clear that future PV lineup for Tata Motors will comprise petrol, diesel, electric and CNG models. The upcoming range of EVs is expected to offer multiple body styles, motor specifications and range capacities catering to different segments. The carmaker will also be developing a widespread charging network across the country in partnership with sister company Tata Power.