Luxury vehicle maker Jaguar Land Rover (JLR) is already assembling several models in India and sees no reason for additional obligations, the Tata Motors’ British subsidiary has said, suggesting that it was unlikely to leverage the Centre’s new Electric Manufacturing Policy for now.
However, Tata Motors Group CFO PB Balaji did not rule out leveraging the EV policy entirely at a later stage.
“If we are able to leverage upon the policy environment, we will definitely consider it. At this point in time, that specific policy is not something that is suitable for us. So, we don’t intend to leverage that at this point in time,” Balaji told reporters in the post earnings call.
JLR India localised manufacturing of the Range Rover and Range Rover Sport models in India this year.
“The business in India is on a very good wicket, growing very strongly, and we have just localised the manufacturing of Range Rover and Range Rover Sport. We are seeing huge pickup in orders on that front. So, we would want this to pick up, we will want to keep localising,” Balaji said.
As volumes pick up, the company would want to localise as much as possible. “We continue to evaluate CKD as a more attractive option given our scale in India,” he said.
The Centre had come up with an EV policy earlier this year slashing customs duty on electric cars with cost, insurance, and freight value of $35000 or more to 15 per cent from the existing 100 per cent. This will be applicable when an automaker commits an investment of at least Rs 4150 crore and achieves 50 per cent localisation in five years.
Tata Motors will, however, continue to look at opportunities of completely knocked down units (CKD) manufacturing in India to ensure it gets benefits of 15 per cent personal duty.
JLR, which posted its best ever first quarter results, is also developing a new electric Jaguar. Prototype road testing is progressing well, the company said. It is in line for becoming debt-free this year. The net debt stood at $1 billion, with a gross debt of $4.8 billion.
As such Tata Motors EV sales have slipped in the first quarter of 2024-25.
Q1FY25 EV volumes at 16,600 units were down by 13.9 per cent due to sharp decline in the fleet segment. The fleet segment (which includes sales to cab aggregators etc) constitutes nearly 20 per cent of their total volumes.
This was due to the discontinuation of the FAME II scheme.
Balaji said that they expect the incentives for four wheelers (in fleet segment) to continue in the third installment of FAME (FAME III policy).
“We expect the FAME III policy to have incentives for four-wheelers because it is for the public good. Ultimately, it is going to help the fleet segments and therefore it is public transport that is getting electrified. These are not personal demands and therefore there is a logical case for this which is being made. We do believe the authorities are sympathetic to the logic, but let us wait and see how the fine print finally is,” Balaji told reporters.
As such, the overall PV business of the company saw a decline in retail registrations in May-June, influenced by general elections and heat waves across the country. At 138,800 units for the quarter, volumes were down 1.1 per cent as the company re-adjusted wholesales in line with retail sales to keep channel inventory under control.
Coming festive season, the company has lined up new nameplate launches – starting with the Curvv in August. In the second half thus the company expects EV sales to grow. Curvv, a mid-segment SUV with a Coupe body style will be introduced first in EV avatar, followed by the internal combustion engine (ICE) versions.
First Published: Aug 02 2024 | 4:19 PM IST
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