Tata Sons group chairman, N Chandrasekaran, in the Tata Motors’ Annual Report for 2018-19 said that the homegrown automobile manufacturer is committed to leading the transition towards electric mobility in India. He further added that Tata Motors looks to work closely with other group entities in order to create a viable environment for electric vehicles in the country. Chandrasekaran said that electric vehicles are necessary for our country. “Your company is committed to take the lead in this transition and work with other companies in the Tata ecosystem to help create a viable environment to drive adoption of electric vehicles,” he said in his message to shareholders.
Chandrasekaran, however, said that the transition has to be perfectly planned with the government and the industry working in sync. This will ensure that the required ecosystem is developed, incentives are provided to stimulate demand and sustainability goals are achieved by implementing emission norms across the value chain. For promoting electric mobility in India, Finance Minister Nirmala Sitharamanhas announced a number of measures in the Budget which includes an additional income tax deduction of Rs 1.5 lakh on loan taken to purchase electric vehicles.
Chandrasekaran said that the next few years are going to be decisive of Tata Motors. “We have to focus on strong operational excellence to deliver positive cash flows while making the right investments to be prepared for the future,” he added. He said that the in order to the company to remain relevant in the world of future mobility, it needs to transform itself and for this, it needs to form partnerships, develop mobility solutions and optimise our investment in the process.
Tata Motors currently stands as the industry leader in the commercial vehicle segment. Chandrasekaran said that the company needs to grow and secure sustainable cash flow from the business along with ensuring a smooth transition to BS-VI emission regulations. He added that the commercial vehicle market is likely to pick up the pace on the backbone of increased infrastructure spending, growth of new-age industries like e-commerce and further progress in the hub and spoke model of distribution.
Chandrasekaran said to the shareholders that in the passenger vehicle segment, Tata Motors needs to enhance its sales and service offering which is a key to growth in volumes and execute its plan to achieve profitability at PBT level. He further added that by 2021, the Indian auto market is expected to emerge as the world’s third largest passenger vehicle market, driven by the underlying economic growth, increasing the consumption demand and mass urbanisation.
“However, in the short to medium term, the sector faces some challenges due to the ongoing credit crunch, low consumer spending and the transition from BS IV to BS VI emission norms by April 1, 2020,” he added. Commenting on Jaguar Land Rover (JLR), Chandrasekaran said the company is taking steps to cut costs while taking a calibrated approach towards future investment in the product portfolio. The company, which is facing a slowdown in sales across regions, is actively looking at partnerships and prioritising its investments while ensuring that it is not compromising its future, he noted. “These are critical interventions and JLR is committed to delivering cost and cash improvements,” Chandrasekaran said.
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