TVS Motor Company is looking to establish a “sustained dominant play” in the electric vehicle segment by leveraging multiple initiatives of the Indian Government such as the PLI or Production-Linked Incentive scheme. As per the official report of the EV maker, it is looking to bump up its plans of scaling in the electric segment.
TVS sold over 10,000 electric vehicles in 2021-2022
The company in its official statement mentioned “The PLI (Production-Linked Incentive) and FAME II (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) initiatives of the government will be fully leveraged by the company and strategically build a sustained dominant play in this segment.”
The industry is set to grow at a rapid pace and the company has solid plans for the future. “In addition, with the strategic association with BMW, the company will be exploring the joint design and development of urban EV options for the global markets,” TVS stated.
The company has exclusively created a dedicated vertical for the EV segment with nearly over 600 engineers and adopted the Centres of Competency (CoCs) with an agile work approach, the company has sold over 10,000 EVs in 2021-22. The company believes that it will outperform the industry in terms of sales growth based on new product launches and economic activity gaining steam.
“Due to the strong product line-up, unwavering focus on consumer, quality, cost, and the strong new launches, the company is confident about outperforming the industry, in spite of the global challenges and a tough business environment,” it mentioned in its annual report for 2021-22.
Domestic moped and economy motorcycle segments have not performed well as predicted by analysts and the sales numbers have been underwhelming but they are likely to increase in growth with some fluctuation expected in rural agricultural markets.
There is a notable improvement in the urban markets across India, the company claimed that it is positive about the performance of the scooter segment. This segment will witness significant demand from students and working women, given the broader segment, it is likely to perform better and in accordance with the re-opening of educational institutes and other offices. Two-wheeler exports will grow this year due to the strong demand for the company’s products and due to operations in diverse geographical locations which mitigate risk to a large extent.
“Some of the geographies, which are agriculture dependent and have a surplus of crude oil, will act as a hedge against the countries which many face adverse impact due to high fuel and food prices,” as per the company. Going into detail on the challenges that hinder growth, the company has stated that the growth in demand is dependent on improvement in consumer sentiment.
“The improvement in sentiment is yet to fully recover to pre-COVID levels and could be impacted by inflation, especially energy and food led, and any significant adverse development in Covid situation,” it stated. Monsoon is still the king of seasons for farmers as it serves the majority of irrigation needs of Indian agriculture, and any deviation from the predicted normal monsoons would impact rural markets to a large extent.
Besides, any additional increase in price due to commodity costs would impact the demand in a negative way. “The low and mid-segment of the market have low headroom for further price increases. Less than projected GDP growth and/or consequent jobs growth could adversely impact domestic demand,” TV cautioned.
During March 2022, the company’s overall two-wheeler and three-wheeler sales inclusive of international business grew by 8% with total sales of 33.10 lakh units as opposed to 30.52 lakh units in 2020-21.
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