Tata Motors has pitched for targeted incentives for entry-level electric vehicles and support for electric cars used in fleet operations under the PM E-DRIVE scheme in the upcoming Union Budget, citing sustained pressure on the mass EV segment.
Tata Motors Passenger Vehicles MD & CEO Shailesh Chandra said that while recent government measures have revived overall passenger vehicle demand, entry-level electric vehicles continue to face challenges.
“I would like to really appreciate the government for reviving the PV industry and the electric vehicle side as well. Two things which can be considered (in the Budget). One there is a lot of pressure on the entry segment on the EV side and if the government would like to consider some level of incentives,” Chandra said.
He noted that pricing pressure on entry-level EVs has intensified following GST reforms, which have led to a reduction in petrol car prices.
“The government last year took significant steps. The big one has been the GST 2.0 but apart from that, there has been repo rate reduction, tax regime change and all. So I think the government has done a significant intervention to spruce up the demand for the overall PV industry,” he added.
Chandra further pointed out that electric vehicles deployed in the fleet segment account for just 7 per cent of total passenger vehicle sales but contribute nearly 33-35 per cent of passenger kilometres travelled.
Also read: Tata Motors to raise price of EVs
He said that while such vehicles were covered under the FAME-II scheme, they have not been included under the PM E-DRIVE initiative.
“A fleet car runs five times more than a passenger car. So therefore, the support that you give to the segment has a multiplier impact at an environmental level, right in terms of particulate matter or zero emissions and on the import of oil. This is one segment which was identified in the FAME scheme, government may consider it for PM E-Drive inclusion,” Chandra noted.
On the possibility of a price hike, Chandra said that foreign exchange pressures and elevated commodity prices have had a 2 per cent impact on the company’s revenues, which has not yet been passed on to consumers.
“Certain levels of cost reduction we have been able to do, but in the coming days, we will decide when and how much we are going to increase the price. It will get announced in the coming days,” he added.
Several automakers have already announced price increases, citing currency volatility and rising input costs.
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