Tata Motors Announces 3% Price Increase on Commercial Vehicles from October
Tata Motors announced that it will implement a price hike of
up to 3% on its commercial vehicles, effective from October 1, 2023. The
rationale behind this price adjustment is to offset the lingering impact of
past increases in input costs. This price adjustment will be applicable across
the entire spectrum of commercial vehicles offered by Tata Motors, as stated in
their official announcement.
It's worth noting that this isn't the first time the company
has adjusted its prices this year. Previously, Tata Motors raised prices by
1.2% in January and then by 5% in March. These earlier adjustments were made to
ensure compliance with the new emission standards, known as Bharat Stage 6,
which were enforced by India starting from April 1. The implementation of these
stricter norms, including the requirement for real-time driving emissions
testing, resulted in increased manufacturing costs for automobile companies, as
reported by Reuters.
In a related development, Fitch, a credit ratings agency,
predicted a slowdown in India's commercial vehicle sales volume. This
anticipated slowdown is attributed to the rising ownership costs associated
with commercial vehicles. Furthermore, the Fitch report indicated that the
adoption of the latest emission norms would likely result in an approximate 5%
price increase for commercial vehicles starting from April 2023.
Simultaneously, Tata Motors is actively working on enhancing
its presence in the rapidly growing electric vehicle (EV) market in India. As
part of this strategic move, the company is in the process of establishing
specialized dealerships tailored to cater specifically to electric vehicles.
Additionally, Tata Motors is finalizing its international strategy, which may
involve the export of electric cars. However, specific target markets have not
been disclosed at this time.
Tata Motors has allocated approximately $2 billion for the
development of battery-powered models by the year 2027. This substantial
investment underscores their commitment to the EV segment. In a positive sign
of progress, the company reported a significant increase in sales of electric
passenger vehicles in India last month. The electric models, including the
Tigor, Nexon, and Tiago EV, collectively recorded a 65% increase in sales
compared to the previous year.
In further efforts to bolster its domestic electric vehicle
supply chain, Tata Motors is in the process of constructing a battery factory
in the western state of Gujarat. This facility is expected to have an
impressive production capacity of 20 gigawatt-hours, solidifying the company's
position in the electric vehicle market.