Tata Motors plans to pump in Rs 35,000 crore into its passenger vehicle (PV) business over the next five years to power the launch of 30 products, including a range of electric vehicles (EVs).
The company has outlined ambitions of raising its market share for passenger vehicles (including EVs) to 16% by FY27 and to 18-20% by FY29. The Mumbai-based firm, which currently accounts for 13% market share, has been under pressure due to the rise of rivals Mahindra & Mahindra, Toyota and JSW MG Motor.
The automaker has lined up at least seven new models and 23 facelifts & refreshes between FY26 and FY30, according top a presentation filed with the stock exchanges. With the addition of these new models, which include Sierra and the Avinya range, Tata Motors will have more than 15 models. A few days ago, it launched the electric version of the Harrier SUV with a drive range of more than 600 kms.
“(There will be) intense action on investment spend focused on innovative new products, software defined vehicles, advanced technologies and powertrains. Total investment spending between FY26 and FY30 to be Rs 33,000-35,000 crore,” a company presentation stated.
Going by the business plans shared by other automakers, Tata Motors will continue to have the largest EV offering in the country with at least 10 models by FY30. Following product launches by M&M and JSW MG, Tata Motors’ market share in the EV space has more than halved to 35% by the end of May from 81% in FY23.
Tata Motors is targeting a ‘double digit’ growth in Ebitda (earnings before interest, tax, depreciation and amortization) for the PV business with cash flows of Rs 1,000 crore. In the medium term, it expects free cash flows for the EV business to be negative.
Compared to FY24, Tata Motors’ Ebitda remained unchanged in FY25 at Rs 3,400 crore while Ebitda margin improved slightly to 6.9% from 6.5%. With the help of the government’s production linked incentive (PLI) scheme, the company’s Ebitda margin for the EV business was in the black at 6.5% in the March, 2025 quarter.
While the PV industry saw moderation in demand during FY25, coupled with high dealer incentive and higher variable marketing expenses (VMEs), demand in FY26 is expected to be muted with seasonally high stock levels and higher VMEs.
Segmental shifts within the PV segment is likely to persist with sports utility vehicles (SUVs) and multi-purpose vehicles (MPVs) likely to be key drivers for growth. While the share of SUVs is expected to rise to 60% (55% in FY25), hatchback share will likely fall to 20% (24% in in FY25) by FY30, the company stated.
Aided by a rapid growth in high consumption households, faster replacement cycles of new cars, the PV industry is expected to increase by 40% to 6 million units by FY30 compared to 4.3 million units clocked in FY25.
In the commercial vehicle (CV) market, Tata Motors saw its market share fall from 39% in FY24 to 37% last year. The company believes it can regain that mark & get to 40% and also drive up Ebitda levels to the ‘teens’ for FY27. Its Ebitda margins stood at 11.8% in FY25, growing from 10.8% in FY24.
Tata Motors is also exploring overseas geographies for its CV business and markets in Asean, LatAm, Central and Eastern Europe are being looked at. As of now, it has presence in SAARC, Africa and Middle East.
After receiving shareholder approval earlier this month the company is expecting a final nod from the National Company Law tribunal for the demerger of the CV business before December 2025. The new CV entity, which will also be listed, will be renamed as Tata Motors (TML) while the existing TML will be renamed as Tata Motors Passenger Vehicles (TMPVL).
