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The planned division of Tata Motors‘ automotive business into two separate listed entities aims to make the commercial vehicle sector more responsive and seize global opportunities, according to Executive Director Girish Wagh. Earlier this year, Tata Motors revealed its decision to separate its commercial and passenger vehicle segments to better harness growth opportunities.
As part of this strategy, one entity will encompass the commercial vehicle (CV) business and its associated investments. Meanwhile, the passenger vehicle (PV) business, which includes electric vehicles (EVs) and Jaguar Land Rover (JLR), along with their related investments, will be consolidated under a different listed entity.
“The proposed demerger will help us improve focus and make us more agile to capitalise on opportunities in the CV market globally,” said Wagh, who oversees the company’s commercial vehicle division, in a message to shareholders in Tata Motors’ Annual Report for 2023-24.
The company believes the demerger will unlock synergies across the PV, EV, and JLR sectors, especially in the realms of EVs, autonomous vehicles, and vehicle software.
On future sales, Wagh remarked, “Looking ahead, I expect FY25 to be yet another exciting year for the CV industry, given the favourable macroeconomic context, especially in the domestic market.”
Tata Motors’ commercial vehicle division has been consistently delivering strong operational and financial results.
“Our focus will be to create a world-class company operating in the CV space, providing superior experience to our customers, better growth prospects for our employees, and enhanced value for our shareholders,” Wagh added.
Shailesh Chandra, the Managing Director of Tata Motors Passenger Vehicles, conveyed to shareholders his belief that the PV sector will settle into a long-term growth rate after three years of robust expansion.
He noted that trends from FY24 are likely to intensify with growing customer preference for vehicles that are safer, smarter, and more environmentally friendly, powered by CNG and batteries.
Chandra also highlighted the continuing dominance of SUVs in the market, with more choices becoming available to consumers.
“At Tata Motors, with new nameplates and launches planned, we will continue our growth trajectory and expect to deliver strong growth,” Chandra said.
The company remains committed to shaping the EV landscape with comprehensive initiatives aimed at expanding the market, building preference, and increasing EV adoption, he stated.
(Source-PTI)
