Range anxiety and the high upfront cost of electric cars continue to deter many from making the switch from internal combustion engines (ICE) to battery-powered vehicles. The recent surge in demand for hybrids, following consecutive launches by Toyota and Maruti Suzuki, has provided consumers with an alternative.
Over the past six months, passenger vehicles (PVs) with hybrid technology have outsold electric PVs, but EV market leader Tata Motors continues to bet on electric as the technology of the future. “We clearly see it (hybrid) as an old-school transition technology. It’s a 20-year-old technology that’s not the technology of the future. And therefore, we remain focused on what we have to do rather than get distracted by what others are saying,” PB Balaji, Group CFO, Tata Motors said.
He added that if the consumer wants hybrids, and if that’s something that’s going to be a material part of the overall portfolio, then the company will be willing to look at it at that point in time. “Our only point is that hybrids are a transition technology which is old-school and is not something where the future is and all hybrid manufacturers have tonns of money, therefore there’s no reason for it to get any incentives from the government.
You incentivise where there’s a need for bridge financing, in order to be able to meet the requirements of the future, you give it for the destination technology. That’s been our fundamental point of view on hybrids. We’ve got a problem with the incentives to the technology,” he adds.
In FY24, the sales gap between hybrids and EVs was about 10,000 units. Despite new launches, EV sales fell just short of the 1 lakh mark, reaching around 99,000 units, while hybrids sold approximately 89,500 units. This increased adoption of hybrids is not limited to India; the U.S. and China are also witnessing a growing preference for hybrids, prompting major automakers to reconsider their aggressive EV transition strategies. Tata Motors remains bullish on EVs both in the domestic market as well as its international plans for JLR to become an all-electric brand by 2030 are on track. “Currently, JLR India’s business is growing very strongly. And all our EV expansion plans are on track,” he said.
As far as our alternate fuel strategy is concerned, he adds, everything has to be linked to CAFE and we’re amongst the leaders when it comes to CAFE compliance and this is going to be even more interesting when CAFE 3 comes with respect to penetration of EVs where if you don’t have EVs in your portfolio, most probably you’ll not have a portfolio. And that’s just two years away,” he adds.