Tata Group plans USD 100 billion auto business with major investment

Tata Group expects its automotive business to reach USD 100 billion over the next five years, backed by major investments, new product launches and stronger collaboration with JLR. The company also aims to increase passenger vehicle market share to 20 per cent by FY30

Mumbai: Tata Group expects its automotive business, including passenger and commercial vehicles, to grow to USD 100 billion over the next five years, with a capital expenditure target of Rs 40,000 crore for the domestic business and about 20 billion British pounds for Jaguar Land Rover (JLR), Tata Group Chairman N Chandrasekaran said on Wednesday.

Responding to shareholders’ queries at the 81st Annual General Meeting of Tata Motors Passenger Vehicles, held virtually, he said the company’s electric vehicle (EV) market share target is to remain at 40-45 per cent. It is around 42 per cent at present.

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Chandrasekaran said Tata Motors Passenger Vehicles Ltd (TMPV) will continue to focus on launching aspirational products for its customers as it aims for a 10-fold growth in volumes between FY20 and FY30 and a market share of 20 per cent.

“I want to say that both companies (Tata Motors Passenger Vehicles Ltd and Tata Motors Ltd) have very ambitious targets. Over the next five years (till FY31), Tata Motors Passenger Vehicles, including Jaguar Land Rover (JLR), will target revenue of USD 60 billion, with JLR contributing about USD 45-50 billion and Tata Motors’ domestic business contributing about USD 15 billion,” Chandrasekaran, who is also the Chairman of TMPV, said.

The combined profit will exceed USD 5 billion, he said, adding that together with the commercial vehicles (CV) business, which has a target of USD 40 billion, the automotive business across the two companies will be worth USD 100 billion.

In terms of capital expenditure, Tata Motors’ domestic business has set a target of Rs 40,000 crore over the next five years, while JLR has earmarked about 20 billion British pounds, he said.

Outlining the passenger vehicle business plans, he said the company has a big ambition over the next five years. “Between FY20 and FY30, the company aims to achieve a 10-fold growth in volumes, with an ambition of more than 1.2 million vehicles, and increase its market share to 20 per cent from the current 14.2 per cent,” he said.

Stating that the company is on a growth trajectory, Chandrasekaran said TMPV will continue to focus on launching products that are aspirational for today’s consumers.

The company has entered FY27 with confidence, backed by a strong pipeline of new products and powertrains in both Tata Motors Passenger Vehicles and Jaguar Land Rover, Chandrasekaran said, adding that JLR has a series of launches planned in the second half of the year.

The company is also investing significantly in digital technologies, especially artificial intelligence (AI), across the value chain. The collaboration between Tata Motors Passenger Vehicles and JLR is also becoming stronger by leveraging their complementary capabilities in manufacturing, technology and talent, he said.

The successful commencement of operations at the TMPV and JLR facility in Tamil Nadu also marks a significant milestone, Chandrasekaran said.

TMPV and its subsidiary, Jaguar Land Rover Automotive, commenced operations at their new facility in Panapakkam in Tamil Nadu’s Ranipet district in February this year.

The facility represents the first phase of a greenfield plant that will manufacture next-generation vehicles, including electric vehicles, for both TMPV and JLR.

Chandrasekaran said the demerger of the passenger vehicle and commercial vehicle businesses into two separate listed entities is “a very decisive step” and not just a structural milestone in the company’s journey to build a differentiated, future-ready, world-class personal mobility enterprise with a strong presence in India and a global footprint through Tata Motors and JLR.

“Our ambition is to build a trusted, aspirational, globally competitive mobility brand that connects meaningfully with the customers of tomorrow,” he said.

He said FY26 had begun on a positive note, with expectations of steady global growth, moderating inflation and easing financial conditions.

However, supply chain disruptions and geopolitical tensions in West Asia towards the end of the financial year heightened concerns over inflationary pressures and slowing growth, Chandrasekaran said. “Also, we had a cyber incident at JLR that led to a temporary production pause of almost two months.” As a result, the company recorded a 21 per cent decline in revenue over the previous year, with revenue of nearly 23 billion British pounds, he said.

Despite the challenging environment, resilience and execution remained critical, and the company delivered a strong performance in India, he said.

He said the company has been on a transformation journey since the Covid pandemic, delivering a strong turnaround in EBITDA and free cash flow.

“What used to be a cash burn of Rs 4,000 crore has become a positive cash flow of Rs 2,000 crore, and EBITDA has improved by more than Rs 5,000 crore. Equally significant have been the product launches, which enabled the company’s market share to increase from 4.2 per cent to 14.2 per cent this year,” Chandrasekaran said.

The overall performance reflected the temporary disruption at JLR, while the return to normal production and sustained demand momentum in the India passenger vehicle business provide strong confidence for the future, Chandrasekaran added.