Tata Motors’ Q3 FY25 sales reflect mixed growth across key segments

Tata Motors Limited reported its Q3 FY25 sales, revealing steady overall performance despite contrasting results across its commercial and passenger vehicle segments. The company achieved total sales of 235,599 units, marginally up from 234,981 units in the same quarter of FY24. This growth was driven by a combination of strong passenger vehicle performance and challenges within the commercial vehicle sector.

Passenger Vehicles: A Bright Spot Amid Industry Challenges

Tata Motors’ passenger vehicle (PV) segment, which includes its subsidiary Tata Passenger Electric Mobility Limited, reported sales of 139,829 units in Q3 FY25, a 1% year-on-year (YoY) increase. This marks the fourth consecutive year of record-breaking annual sales for Tata Motors in this category.

A significant contributor to this success was the company’s SUV portfolio, particularly its flagship model, Punch, which emerged as the highest-selling car in India in 2024, with over 200,000 units sold. Electric vehicles (EVs) continued their upward trajectory, with 16,119 units sold in Q3 FY25, reflecting a 6% YoY increase. However, the growth in fleet sales was tempered by the expiration of the FAME II subsidy, underscoring the sector’s dependence on government incentives.

Shailesh Chandra, Managing Director of Tata Motors Passenger Vehicles and Tata Passenger Electric Mobility, attributed the sustained momentum to the company’s diverse multi-powertrain strategy and a series of successful product launches, including the Nexon.ev 45 and Curvv.ev. He also highlighted the robust demand for compressed natural gas (CNG) vehicles, which saw a 77% YoY increase in 2024.

Commercial Vehicles Face Marginal Declines

In contrast to the passenger vehicle segment, Tata Motors’ commercial vehicle (CV) sales witnessed a slight 1% decline YoY, with 95,770 units sold in Q3 FY25. The high-capacity vehicle (HCV) subsegment bore the brunt of the slowdown, with a 9% YoY drop due to limited growth in key end-use industries.

However, there were areas of optimism. Intermediate and light commercial vehicles (ILMCV) registered a 3% YoY growth, buoyed by strong demand in urban and semi-urban markets. The passenger carrier category recorded a remarkable 30% YoY increase, largely driven by purchases from state transport undertakings and private fleet operators.

Girish Wagh, Executive Director of Tata Motors, noted that while YoY performance in the commercial segment remained subdued, sequential quarter-on-quarter (QoQ) growth indicated signs of recovery. He highlighted the resurgence in construction and mining activities post-monsoon as a critical factor in driving demand, particularly in the heavy vehicle category.

Strategic Outlook for FY25

Tata Motors remains optimistic about its future growth prospects, buoyed by several factors. In the passenger vehicle market, continued product innovation, a focus on emission-friendly powertrains, and sustained interest in the SUV and EV segments are expected to drive demand in 2025.

In the commercial vehicle segment, government spending on infrastructure and improvements in industrial activity are anticipated to stimulate growth. However, challenges such as financing hurdles for first-time buyers and fleet operators remain concerns.

Both segments are set to benefit from Tata Motors’ strategic focus on technological innovation and its commitment to expanding its market share through diversified offerings.