About 10% of all cars sold by Tata Motors need to be electric once the third phase of the corporate average fuel efficiency norms (CAFE 3) kicks in from April 2027, according to Tata Motors’ Shailesh Chandra.

“If we really have to go by what the BEE (Bureau of Energy Efficiency) has proposed so far. It would mean 10%-plus EV penetration for a manufacturer like us. We are already at 11%, so we are pretty comfortable,” Chandra, managing director of Tata Motors Passenger Vehicles and Tata Passenger Electric Mobility, said in an analyst call after the automaker announced its fourth quarter earnings.

Tata Motors aspires to achieve 30%-plus EV penetration by FY30, said Chandra. “We are pretty much on track and safe.”

As the growth of electric vehicles in India slowed last fiscal, Tata Motors, the country's leading producer of zero-emission cars, lowered its long-term sales forecast for electric vehicles. It now expects a 30% penetration rate, down from the previously projected 50%. The new estimate is in line with the government’s policy think tank NITI Aayog’s 2030 goal for electric cars.

JSW MG Motor India, backed by China’s state-owned SAIC Motor, has been chipping away at Tata Motors' EV market share. The launch of Mahindra & Mahindra's (M&M) born electric cars—BE 6 and XEV 9E—has further added to Tata’s woes. Tata Motors saw an 11% year-on-year decline in electric vehicle sales, with only 4,415 units sold in April. This drop led to a reduction in its EV market share to 36% for the month, based on data from the government’s VAHAN portal. For the 2024-25 financial year, the company’s EV market share slipped to 53%, down from over 70% in FY24. Riding on brisk sales of the Windsor EV, JSW MG Motor India’s EV market share stood at 28% in April, while M&M clocked a market share of 24%.

“We are aspiring to keep our market share above 50%-plus. There will be short-term pressure. Whenever a new product gets launched, typically the sales volumes are 2X of the steady-state volumes. Most of the launches have happened recently and it will continue. It’s a launch year for all the OEMs. So there will be short-term volatility,” said Chandra.

Tata Motors sees broadly four segments in the EV space now. “One is the entry segment of city cars priced less than ₹12 lakh. Here we have 75%-plus market share with products like Tiago EV and Punch EV. We are going to take some action in this space,” Chandra said without sharing details. “The requirement would be to come closer to the price parity with ICE and the range should be comfortable. We will overcome some of the barriers that still remain in this segment. That will expand the segment where we have a very high market share,” he said.

Tata Motors’ passenger vehicle chief said the mid-size EV segment from ₹12-20 lakh is seeing intense competition. “This is where the whole action is. All the manufacturers are coming with products in this segment. Therefore, intensity will be high. The way of winning the game in this segment: there will be short-term action from our side and mid-term (18-24 months) action to ensure that we dominate this segment also,” said Chandra. Currently, Tata Motors’ market share is 30-33% in this segment, he said, adding, “But this is the crucial segment where maximum volumes would lie."

Then, there is the ₹20 lakh-plus segment, which is emerging and showing great promise, said Chandra. Tata Motors will launch two products in this segment – Harrier EV and Sierra EV.

“The fourth segment is fleet. We had addressed the TCO (total cost of ownership) against diesel but there is a big market for CNG and this is where our focus is to ensure that the value proposition of our fleet products surpasses that of CNG. This should also help us tap greater volumes,” he explained.

All these actions will help Tata Motors in keeping its EV market share above 50% in the mid-term, Chandra said, adding he is not worried about short-term volatility.