According to a Tata Motor’s official, the company is actively scouting for a partner for its passenger vehicle business to be ready for growth in the next decade, recognizing huge investments going into new technologies and regulations.
The company is looking for collaboration for the passenger vehicle business, a separate standalone unit that gathers steam.
At the beginning of this year, the auto major’s board had approved the formation of a separate entity that would house the PV business, including the EV vertical, by transferring relevant assets, IPs, and employees directly relatable to the standing be fully functional on a standalone basis.
Tata Motors President Passenger Vehicles Business Unit Shailesh Chandra said in an interview, “The whole idea of subsidiarisation is to actively look for a partner because this is a reality for all of us that a collaboration can unleash a more significant potential in the next decade which is going to see significant investments in new technologies and regulations.” He also mentioned that this new venture would reduce product life cycles and improve new product launch intensity. Further, he noted that “All this requires huge investments, and agility is also the key. So this is something which we are actively looking into.”
Chandra noted: “There are no specific timelines as far as the subsidiarisation process is concerned, converting the business into a separate legal entity, we would like to accelerate in a year, and as far as the partner is concerned it is an active work which we will continue to work on.”
“This has resulted in a market share of 7.9 percent in the passenger vehicle segment the company’s product range has been appreciated for safety and pleasure of driving,” he said.
He also quoted that the PV division witnessed growth revival as sales grew by 18 percent in the July-September quarter during this financial year. He further added that sales have maintained during the global pandemic period as people preferred personal vehicles over public transport.
“A big part of it has increased the demand, which has been a big factor for growth. However, there was a 20% degrowth last year because people wanted to wait for BS-VI products leading to pent-up demand in the last year. The other two months of lockdown this year has led to huge pent up demand,” he noted.
“It remains speculative how the things would turn out to be beyond that and festive season because something is offsetting these positive trends –pent up demand combined with personal mobility needs.
“It is the whole macroeconomic situation which is not witnessing growth, GDP is expected to see a 10 percent decline. We will have to see the overall effect of that post the festive season. So far, indications are that it will sustain,” Chandra said.