New Delhi: Days after Union minister Nitin Gadkari warned automakers of “additional 10 percent” GST on diesel cars, top Tata Motors officials said that ‘there is a market for diesel vehicles in India currently’, and that ‘it is unfortunate that questions are being raised about diesel rather than questioning manufacturers who are not moving to electric vehicles’.
“For us, we are very clear that we have defined our net zero in 2040, which means a very fast acceleration of EVs. Our focus is that,” said Shailesh Chandra, managing director, Tata Motors Passenger Vehicles Ltd.
Speaking to reporters Thursday on the sidelines of the launch of two new vehicles — new-gen Nexon (internal combustion engine) and Nexon.ev — Chandra, however, added, “But at the same time, we realise that this transition has to take time. 10-15 years… there are many people who want this (diesel).”
“As an OEM (original equipment manufacturer), our policy is simple. We will keep adapting to how regulation comes. We have adapted. For example, we discontinued so many models which were earlier diesel. And regulation itself does that. It lets you exist at the right time. When the regulation requirements become so stringent that a certain powertrain cannot exist, we will follow that,” said Chandra.
Stating that diesel vehicles are now selling only in a few segments, he added that implementation of BS7 norms may put more pressure on diesel powertrains.
“So we will follow market forces and we follow what the government brings. We have shown the biggest commitment to what the government wants i.e. EVs. It is unfortunate that people are asking questions on diesel and not asking manufacturers who are not moving to EVs… but we are asking questions on what about diesel. Forget that. That, in any case, is declining. It will decline on its own,” he told reporters.
Chandra’s remarks come days after Union minister Nitin Gadkari’s warning to automakers. Speaking at the Society of Indian Automobile Manufacturers (SIAM) annual conference in New Delhi, Tuesday, Gadkari said he would ask the finance minister to levy “additional 10 percent” GST on diesel vehicles if automakers don’t “say bye to diesel soon”.
The minister for road transport and highways, however, later clarified that there is “no such proposal” under active consideration at this time.
Speaking to ThePrint, Vinay Pant, head of marketing at Tata Motors Passenger Vehicles Ltd., added that there is still demand for diesel vehicles with such vehicles accounting for about 14 percent of the company’s sales.
“… we would continue to be there in that market till the time we are meeting the regulations at a kind of a cost which the people can absorb…,” he said.
Pant added that there is a market for diesel vehicles largely because of two kinds of people — those who love diesel for the “kind of punch” driving a diesel car gives them and those who buy it due to fuel prices and running costs.
“…Slowly things would be changing. Newer technologies would be coming in… but currently I feel that there is a market for diesel and that shows because we have some of the cars which are only diesel, they are doing pretty good numbers. There are cars where there is an option of diesel and they’re getting reasonably good numbers. So the market is there currently and we would be meeting whatever the requirements are,” he said.
Launched Thursday, the new Nexon.ev is priced between Rs 14.74-19.94 lakh (ex-showroom) and comes with a maximum range of 465 km in a single charge. Tata also launched the Nexon with petrol and diesel engines with introductory prices starting from Rs 8.09 lakh (ex-showroom).
Chandra said the compact SUV segment, in which Nexon competes with the likes of Maruti Brezza, Hyundai Venue and Kia Sonet, has grown very steeply over the years. “When we had launched Nexon in 2017, this segment used to see sales of 30,000 units a month, today it has grown to 90,000 units a month,” he said. This, he added, is the most intensely fought segment as well with all the leading players having a product in the market.
(Edited by Amrtansh Arora)