Tata Motors plans to boost its commercial vehicle (CV) market share to 40% by 2027 while achieving double-digit EBITDA, alongside strengthened EV profitability and cutting-edge SDV investment.
CV Business – Acceleration & Efficiency
Tata’s CV division plans to “step up the pace”, targeting a 40% market share by 2027 with teen EBITDA margins (10–19%).
FY25 results:
CV EBITDA margin: 11.8% (up 100 bps YoY)
Free cash flow: ₹7,400 cr (10% of FY25 revenue)
ROCE: 37.7%
Industry outlook favourable, with freight demand rising, stable fuel costs, and targeted investment in decarbonisation and connectivity via Software Defined Vehicles (SDVs).
EV & Passenger Vehicle (PV) Strategy
EV arm broke even on EBITDA in FY25, marking a turnaround in profitability.
EV growth targets:
20% penetration by FY27
Over 30% by FY30
Strong funding secured for EVs over the next three years, with cost convergence planned between EVs and ICE vehicles.
Launch focus on Harrier EV and upcoming Sierra EV, aiming to reclaim falling EV market share (35% in May 2025 vs ~66% a year ago).
Profitability & Market Context
In FY25, PV & EV business set a target of ~10% EBITDA by FY30.
Despite heightened competition from rivals like MG, Hyundai, and Mahindra, Tata is focusing on the SUV and fleet segments, using a wide product portfolio and improved after-sales to drive volumes.
Facing Trade Risks & Competition
Management acknowledges global trade uncertainty may add volatility—but underlined in-house discipline and robust fundamentals that support CV business resilience.
Strategic investment of ₹33,000–35,000 cr boosts capacity to overtake Hyundai and M&M in passenger vehicle space.
Bottom Line: Three Pillars of Tata’s Growth Strategy
Commercial Vehicles: Deepening market share to 40% by 2027 with strong margins and SDV-led innovation.
Electric Vehicles: Sustained EBITDA growth, ramp-up in market share via Harrier EV & Sierra EV.
Product Expansion & Efficiency: Large investment backed by cost convergence and after-sales improvements.
