Tata Motors is betting that its new low-priced Punch EV will succeed in cracking the dominant budget segment of the world’s third-largest car market for electric vehicles, its CEO said ahead of the model’s launch on Friday.
Around 65% of the 4.6 million passenger vehicles sold in India last year were priced below $13,200. But, of those affordable cars, just 1.6% were EVs, compared to 10% of those in higher price categories.
There currently are only a small number of EV models available in the lower price range in India. And range anxiety and concerns around their slow charging times and battery life reliability are holding back buyers, Shailesh Chandra told reporters.
“The real challenge is the entry segment. Until we crack this, we will not be able to mainstream EVs,” Chandra said.
The new Punch EV is priced from $10,650, with a long-range variant that can cover a distance of 350 kilometres (217 miles) on a single charge selling for $13,850.
The Punch can be charged from a 20% battery level to 80% in 26 minutes with a fast charger, the company says, and comes with a lifetime battery warranty.
Tata is also offering an option to decouple the price of the car from the battery, reducing the EV’s upfront cost to $7,100. The battery can then be paid for separately at a price of 3 cents per km.
GOVERNMENT WANTS MORE EV ADOPTION, BUT SALES LAGGING
India’s government is pushing to increase EV sales to 30% of the total market by 2030 from around 5% currently to reduce the country’s dependence on imported fuel and bring down high levels of pollution in its cities.
However, EV sales growth has slowed, pushing carmakers to offer discounts.
Chandra said Tata Motors is sacrificing margins “to some extent” on its EV range to ensure there is long-term progress towards electrification, but added that profits are not far below its combustion engine car business.
“EVs have moved from being experimental to being a serious play,” he said.
Tata, India’s largest seller of electric vehicles, competes with JSW MG Motor, SAIC’s India venture, and Mahindra & Mahindra.
Maruti Suzuki, India’s biggest carmaker, is the latest to enter the EV segment with its e-Vitara SUV, priced from around $12,000 for the base variant in which the battery is leased separately and $22,000 for the long-range model.
(Reporting by Aditi Shah; Editing by Joe Bavier)
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