Home / Companies / News /  Tata Motors launches electric Nexon, says open to fleet sales if it enhances brand

Tata Motors Ltd may still allow its all-new, long-range electric car, Nexon EV, to be used selectively for certain fleet applications, said a senior company executive, citing benefits under the faster adoption and manufacturing of hybrid and electric vehicles, or FAME 2 policy, which are given only to electric cars registered for commercial use.

“I won’t say that I won’t position the Nexon EV in the commercial segment, it means a lot for driving my EV volumes in the future. However, I will be very selective. For example, I will be open to giving my Nexon EVs to Taj (Hotels) as it would only enhance my brand," Shailesh Chandra, president, electric mobility business unit, Tata Motors, said in an interview. He was clarifying Tata Motors’ stand on positioning the Nexon EV as the company’s first electric car aimed at the personal vehicles segment.

Last September, Chandra said that focusing only on fleet segments could prompt personal car owners to perceive EVs as taxis, which would be bad for their adoption in India. According to the company, the fleet segment is just 10% of the total passenger car market, whereas the personal segment accounts for 90%. Tata Motors already sells its Tigor EV for commercial applications.

Speaking on the sidelines of Nexon EV’s launch in Mumbai on Tuesday, Chandra said the vehicle has been conceived for private use and fleet applications do not require all of the features and performance specs that the Nexon EV is equipped with. “However, whether we will sell the car for fleet applications or not will be decided on what those applications do to the Nexon brand. There are certain segments within the fleet that enhance the brand and there are certain applications that are important to drive the EV demand going forward," he added. The Nexon EV has been launched at an introductory price of 13.99-15.99 lakh (ex-showroom all India), making it the cheapest long-range electric car in India. The model will be available in three variants—XM, XZ+ and XZ+ LUX—two of which would qualify for benefits under FAME 2, if registered for commercial applications.

Electric cars with commercial registration and priced below 15 lakh are eligible for benefits under FAME 2, which allows either incentives of up to 20% of the ex-factory price with a maximum cap of 3 lakh, or incentives of 10,000 per kWh on the battery capacity (whichever is lower).

This translates into a straight benefit of up to 3 lakh, apart from the already reduced GST rate of 5% on EVs, as against 28%, or more, on petrol and diesel cars.

“There are certain reference numbers that I have taken for the next 1-2 months to produce Nexon EV, but we will have more clarity once we get some understanding of the customer pulse on the product over next 2-3 months," said Chandra, adding that currently there were no yardsticks to gauge the demand for electric cars in the personal cars segment.

“Tata Motors has certainly priced the Nexon EV aggressively and it appears to be at par with vehicles with internal combustion engines in terms of features, safety and connectivity. But it remains to be seen if it can convince buyers of its value in terms of utility. Retail customers may use the leasing/subscription models of ownership," said Suraj Ghosh, principal analyst (powertrain forecast), IHS Markit.

The Nexon EV is the first electric vehicle from Tata Motors to be powered by the in-house Ziptron technology, which is a modular electric powertrain platform comprising a 129 PS permanent magnet AC motor powered by a 30.2 kWh dust and waterproof lithium ion battery.

Even as Tata Motors plans to retail the Nexon EV from 60 dealer outlets across 22 cities, it taps into the synergies with its group companies, including Tata Power, Tata AutoComp and Tata Chemicals. To extend support on EV charging infrastructure, Tata Power has already set up a network of about 100 charging stations and plans to scale this up to 300 by March 2020, and 650 by March 2021.

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