At the same time, last year we held 50 percent market share in passenger vehicles also. For Tata, it has been quite a journey in the passenger car business from selling more multipurpose vehicles (MPVs) and multi-utility vehicles (MUVs) to now selling personal cars. This has been one of the key transitions for us in Nepal over the past three years.
The other big transition is happening in the electric vehicles (EVs); the four-wheeler EV market in Nepal is unfolding in a similar manner to India which is also very important for us. We will be highly committed to this market. We will not only bring products that will look attractive but also take the responsibility of the electrification of the automotive market and supporting what the Government of Nepal is also trying to do. We have all the wherewithal in terms of the range of products for the Nepali market. At the same time, we are also committed to developing the ecosystem which is more important. Besides charging stations, we have also established an EV learning center here. Similarly, there is a repair center for batteries; we have such facilities, one each in India and Nepal. We want to bring new things to this market where there are very discerning customers and people who are ready to transition to new technology. In Nepal, the transition to EVs has happened in just two years. This kind of transition does not happen so easily in the world. The automobile market in Nepal is going through a slump due to last year’s restrictions on imports and the rise in interest rates. How have these factors affected the business of Tata Motors in Nepal? The ban, which lasted for eight months, caused a 60 percent decline in vehicle sales. Typically, about 12,000 vehicles are sold in Nepal in a year. After the import ban, the number of sales went down to about 4,000-6,000. However, there has been a 30 percent increase in our EV sales. The Tata Nexon EV Prime and the Tata Tigor EV played a key role in our success in the EV market last year. Moving forward, the Nepal government is also providing a congenial environment for EVs to get promoted, which is going to further support the growth of EVs and our portfolio. Tata Motors is currently in Generation 1 EVs and is said to be rolling out Generation 2 EVs. When will the company roll out the Generation 2 EVs and how different will they be from the current ones? We have followed a very evolutionary approach to bringing products, which means that when the market is not mature and the volumes are low, the consumer mindset is not in favor of a certain technology. This is where we start small. This is why we started with Gen 1 vehicles which are conversion products. It has worked well because there was a familiarity with that kind of product in the market. As battery prices have declined in the international market, there is a greater acceptance of EVs. Our Gen 2 will be a major intervention in the current Internal Combustion Engine (ICE) architecture where we will create orthogonal spaces in the floor of the vehicles to accommodate more batteries. This will increase the range and even the exterior look of the vehicle will change. Similarly, Gen 3 vehicles will be pure EVs, where there will be no possibility of making petrol or diesel vehicles on that architecture. One product that we have already showcased is Tata Avinya. So, when will Tata Avinya be commercially launched? We had already mentioned in our auto expo that Avinya will hit the market by the end of 2025. This is what we are targeting for the Indian market. The Tata EVs, first through Nexon and now with the Xpress T—are making strong inroads into the Nepali EV market. How do you see the future of Tata EVs in the Nepali market? I think it is very important to hit the right balance of things and Nexon EV has been able to do that. While conceptualizing the Nexon EV, we asked ourselves whether we should give it a higher range. Higher range means higher cost, right? What if I want to keep my prices low, come with a lower price? Then you’ll have to reduce the range and then range anxiety starts. So, you have to bring the balance of range price features in a manner that is acceptable to a customer. The consumers had already accepted the aspirational product Nexon in the ICE world. Also when it comes to the EV world, the price is not twice of an ICE but just 25-30 percent more. And with all the features, customers have loved it. And I think with all the support that the government was giving in terms of reduced duty structure, it was aggressive on the price also. So, I think it has worked well. And that’s why a majority of electric vehicles sold in Nepal are Nexon EV today. But I would also say that the charging infra that our partner has put on the highway, which is about 20 charges that as a combination was important to give confidence to the people that they can not only be used within the city, but they can also go for outdoor sea experiences. So, I think that also has a major role. When do you think EVs will be the mainstream in the South Asia region? In our part of the world, EVs are already mainstream. It is because EVs currently have over 50 percent penetration rate. EVs are more feature-rich vehicles and are a pleasure to ride. The vehicles have low operating costs. Earlier, the range of EVs was an issue of big concern for customers. But we have resolved the range issues with products such as Nexon EV Max. Will a market like Nepal continue to get ICE vehicles? While you would like to change faster, the world changes at its own pace. Manufacturers can promote and bring attractive products, but customers will take their time to adopt new things. Some of them are fast adopters, some are late adopters and later the majority will come. So, it will go through the adoption phase and value chain preparation for new technology. There will be a period when both technologies will co-exist. Till there is a demand in the market, we will serve our customers in both the ICE and EV categories.
