Tata Motors Passenger Vehicles (TMPV) will maintain capital expenditure in the range of 6–8% of revenue even as the Indian passenger vehicle market continues to shift toward SUVs, CNG vehicles and battery electric vehicles (BEVs), according to Managing Director and Chief Executive Officer Shailesh Chandra.

Speaking during the company’s post Q4 FY26 earnings call with reporters, Chandra said domestic demand remains resilient and is expected to support industry growth of around 10% in FY27, aided by GST-led affordability benefits and sustained retail momentum.

Capacity expansion tracks demand pipeline

TMPV said its investment cycle remains intact, with no plans to defer or scale back capex despite geopolitical uncertainty and input-cost pressures. The company indicated that capex intensity could marginally move above the 6–8% band depending on product rollouts and capacity additions.

“There is no question of stopping or postponing any of our capex on products,” Chandra said, adding that production ramp-ups are being aligned with demand across SUVs and alternative powertrain offerings.

The automaker is expanding flexibility across internal combustion, CNG and electric platforms as part of its multi-powertrain strategy, while strengthening supply-chain resilience to manage global disruptions.

BEV demand rises after West Asia tensions

TMPV flagged a sharp uptick in BEV demand following geopolitical tensions in West Asia and rising expectations of fuel price increases. The company said enquiry flow and bookings have improved meaningfully since March.

“If I isolate the impact of the Middle East situation, we have seen a 25–30% jump in bookings,” Chandra said, attributing the momentum to higher fuel sensitivity and improving EV consideration.

BEVs remained a key growth driver in FY26, with Tata Motors selling over 92,000 electric vehicles, up 43% year-on-year, while retaining a market share of just over 40% in the segment. EVs and CNG together accounted for 43% of total volumes.

Cost pressures and outlook remain mixed

TMPV flagged sustained commodity inflation as a key risk, with input costs across steel, aluminium, copper, rubber and petroleum-linked materials rising over the past 9–12 months, estimated at around 5%.

The company also highlighted West Asia-related geopolitical uncertainty as a monitorable due to its impact on logistics, fuel prices and supply chains, along with volatility in battery raw material costs such as lithium.

FY26 marked record passenger vehicle sales of over 6.4 lakh units, up 15% year-on-year. However, consolidated performance was impacted by headwinds at Jaguar Land Rover, with revenue and profitability under pressure. The India PV business remained the key growth driver with strong volumes and margins.