Tata Motors, which had registered record passenger vehicle sales in FY2024 and CY2023, has released its wholesales numbers for June 2024 as well as the first quarter of FY2025. What’s apparent is that growth is slowing down for the company. Despite being in growth zone in the first six months of 2024 with dispatches of 293,114 cars and SUVs including 37,219 EVs, sales are slowing down month on month for Tata Motors amidst growing competition in the marketplace.
Tata Motors, which is the third-ranked passenger vehicle OEM after Maruti Suzuki and Hyundai Motor India, is to some extent feeling the heat of the strong SUV competition from Maruti Suzuki, Mahindra & Mahindra and Hyundai Motor India.
Sales decline month-on-month sales for five straight months
Wholesales data for the past six months reveals that Tata Motors has witnessed month-on-month declines for the past five months (as depicted in the two data tables below for Q1 FY2025 and H1 CY2024). January 2024’s sales of 53,633 units were up 23% on December 2023’s 43,470 units.
After January 2024’s 53,633 units, up 23% on December 2023’s 43,470 units, sales have seen month-on-month declines from February through to June.
The company’s cumulative sales for the first quarter of FY2025 (April-June 2024) at 138,104 passenger vehicles are down 1% YoY (Q1 FY2024: 140,120 units). Even its EV sales are down for Q1 FY2025 – the 16,759 units are down by a sizeable 14% YoY (Q1 FY2024: 19,346 units) as a result of 2,767 fewer electric cars and SUVs being sold.
On the cumulative six-month sales front, things improve because of the much better wholesales in the last quarter of FY2024, which constitute the first three months of calendar year 2024. With 293,114 PVs sold in the January-June 2024 period, Tata Motors has registered 7% YoY growth (January-June 2023: 275,013 units). EV dispatches, at 37,219 units, in H1 2024, are up 5% YoY (H1 2023: 35,306), once again due to growth in the first three months of CY2024. There has been a sustained decline from April to June 2024.
Demand for its CNG models is growing. While the specific launch date remains unknown, Tata Motors has confirmed that it will introduce the Nexon iCNG model this fiscal year. On the new variant front, June 6 saw the company launch the new Altroz Racer, the sporty avatar of the snazzy premium hatchback and its answer to the Hyundai i20 N Line.
Maintaining the lead in EVs but the competition’s growing
One of the market advantages that Tata Motors has is that its ‘New Forever’ portfolio spans petrol, diesel, CNG and electric powertrains, thereby considerably expanding its reach compared to most of its rivals. In the ongoing calendar year to date, the EV share of Tata Motors’ overall passenger vehicle dispatches is 12.69% compared to 12.83% in the January-June 2023 period.
In CY2023, Tata Motors sold a record 69,153 EVs, up 59% YoY and averaging monthly sales of 5,762 units. EV penetration last year was 12.55 percent for the company. In first-half CY2024, the monthly sales average has risen by 7.65% to 6,203 EVs with H1 2024 dispatches currently 54% of CY2023’s sales. Sales of the Nexon EV are likely to pick up given the fact that the zero-emission SUV recently aced the Bharat NCAP crash test with a 5-star rating.
On the EV retail front, Tata Motors, which has the largest portfolio comprising the Nexon EV, Tigor EV, Tiago EV, Xpres-T (for fleet buyers) and the Punch EV, sold 27,869 EVs in H1 2024, which helps it maintain its lead with a 68.54% market share, albeit down on the 74% share it had a year ago (January-June 2023: 25,027 EVs). The company’s share of the ePV market, which was not too long ago upwards of 75%, has been reducing, reflecting the growing competition in the form of new products from rival EV OEMs and increased choice for the buyer. Nevertheless, there continues to be a big difference in numbers between Tata Motors and the rest of the competition.