Over the next four years, Tata Motors is planning to invest $2 billion to deploy 10 new electric vehicles, along with its wider passenger vehicles (PV) division, which had been losing until a couple of years ago and is hoping for a better free cash flow by 2022-23.
The move comes when the TPG Rise Climate private equity group revealed plans to invest Rs 7,500 crore in Tata Motors’ new wholly-owned subsidiary for electric mobility.
The Auto Major has a robust product launch plan for electric vehicles, Shailesh Chandra, president of the business unit for passenger car Tata Motors said, and expects 20 percent of green motors’ sales over four to five years.
“Right now we are getting bookings of 3,000-3,500 units per month with two green products (Nexon and Tigor EVs). However, only about 1,000 units can be supplied. We are now lining up new investments to the tune of $2 billion just for electrics and this would be used to add 10 new green vehicles, boost production capacity and charging infrastructure, and create IP (intellectual property),” said Chandra.
The company recorded its 10,000th EV customer on board last month. In August, Tata Motors passed 1,000 unit volume and held a market share of 70 percent.
The business plans to use all of Tata Motors’ current assets and capabilities to accelerate investments in charging infrastructure and battery technology, while also channeling future investments into electric vehicles, specialized ‘BEV’ platforms, and advanced automotive technologies.
According to N. Chandrasekaran, Chairman, Tata Motors “I am delighted to have TPG Rise Climate join us in our journey to create a market-shaping electric passenger mobility business in India. We’ll keep putting money into interesting new products that delight customers while simultaneously building a productive ecosystem around them. We are excited and committed to playing a major role in the government’s goal of a penetration rate of 30% by 2030 for electric vehicles.”
It has been announced that the TML EVCo, a Tata Motors-owned firm created specifically for the electric vehicle market, will be in charge of the passenger electric mobility operation. Tata Motors stated that 50 million A1 convertible preferential shares will be issued, with 25 million A2 convertible preferential shares obligatory to TPG, with an aggregate of Rs 7,500 crore.
In the last few months, despite production issues due to the lack of semiconductors, the company reports that it has averaged monthly sales of roughly 30,000 units.