Tata Motors announces price cuts for first electric vehicles in India, lowering prices by up to 8%.

Electric car sales in India currently account for just 2% of total car sales. This low figure is attributed to buyers’ concerns about the higher upfront costs and range anxiety, despite the lower running costs of electric vehicles. Vivek Srivatsa, Chief Commercial Officer at Tata Passenger Electric Mobility, stated that they have decided to pass on the benefits of softened battery cell prices to customers. As a result, the price of the top-selling Nexon.ev has been reduced by 1.4% and the price of the electric small car Tiago by 8.1%.

Tata, which dominates the electric car market in India, also plans to expand its electric car portfolio over the next few years and aims to increase EV sales to 25% of its total car sales by 2025. The recent price cuts by Tata could lead to increased competition and the launch of newer, more competitively priced electric vehicle models by its rivals. Globally, electric vehicle sales have also slowed, with U.S. carmaker Tesla leading a price-cut war to maintain its market lead over competitors. Jay Kale, Vice President at Elara Capital, believes that Tata’s price cuts in India could prompt its rivals to follow suit and launch new electric vehicles at more aggressive prices.

Tata Motors, which competes with companies such as Mahindra and MG Motor, experienced a 1.9% drop in its shares following the announcement of the price cuts.