How Tata Motors plans to win again the market with its hatchbacks-OxBig News Network

Unlike the nation’s largest carmaker, Maruti Suzuki India Ltd, which stays bearish about the way forward for small hatchbacks, Tata Motors believes premium choices within the ₹7-10 lakh vary within the phase have potential. 

Vivek Srivatsa, chief industrial officer at Mumbai-based Tata Motors, acknowledges {that a} lack of deal with upgrading merchandise within the hatchback phase resulted within the firm dropping market share.

“Earlier, clients would begin with entry-level hatchbacks after which transfer to premium choices. But now, many are immediately beginning with hatchback vehicles,” Srivatsa instructed Mint put up the launch of Tata Altroz’s facelift on Thursday.

With Tiago and Altroz’s facelifts within the final 5 months, the nation’s third-largest automotive maker hopes that its share within the premium hatchback phase will double from 12% at the moment. 

In the monetary 12 months 2025, Tata Motors’ whole gross sales declined by 3% to 556,263 items. Meanwhile, Mahindra and Mahindra’s dispatches surged 20% to 551,487 items on the again of robust SUV (sports activities utility autos) gross sales. 

While SUVs dominate the market, Tata Motors nonetheless believes the hatchback phase can do effectively if investments are made in enhancing product high quality. Tata’s Altroz competes with Maruti’s Baleno and Hyundai’s i20, amongst others. 

“Post the improve of Tiago in January, the expansion was round 20% in its gross sales within the final quarter,” Srivatsa famous. 

The optimistic steering of Tata Motors on hatchbacks contrasts with Maruti Suzuki’s stance. At a post-earnings press meet, R.C. Bhargava, chairman of Maruti Suzuki, expressed concern over the corporate’s sluggish progress within the home market. 

“Unless one thing adjustments, the home market will stay muted. In this present 12 months, gross sales of small vehicles have declined by about 9%. If there may be such a decline within the gross sales of vehicles that may be afforded by 88% of individuals incomes, how can we count on progress?” Bhargava requested.

Maruti’s total gross sales within the home market grew a muted 3% to 1.9 million items within the final monetary 12 months, totally on the again of an 82% surge in sales to Toyota as part of its partnership. Excluding this, Maruti’s progress within the home market was round 0.2%.

Hyundai Motor India Ltd additionally flagged weak shopper sentiment out there. The South Korean automotive maker stated it would as a substitute deal with 7-8% progress in exports to offset the weak shopper demand. Its gross sales within the final monetary 12 months declined 3% to 598,666. 

Also Read: Jaguar Land Rover tariff hit compounds Tata Motors’ domestic woes

Going premium

Meanwhile, Tata Motors stays bullish in regards to the prospects within the Indian market and is guiding for about 5% progress, increased than the trade’s estimates of 1-2% progress within the present monetary 12 months.

“Much of the degrowth out there has occurred within the cheaper hatchbacks. Consumers predict much more from their vehicles, which is main lots of automotive patrons to immediately bounce to premium hatchbacks,” Srivatsa stated.

The push towards premium hatchbacks is a part of Tata’s technique to revive quantity progress, particularly after net profit slipped 11% to ₹28,100 crore in FY25 from ₹31,800 crore within the earlier 12 months.

“Refresh launches of Altroz and Tiago (launched in This fall) will assist Tata Motors regain misplaced market share in hatches, whereas the launch of Sierra ICE and EV and Harrier EV could strengthen Utility Vehicle share,” Elara Capital stated in a 14 May observe.

The firm acknowledged, put up the discharge of the outcomes, that the worldwide surroundings is difficult. “Tariffs and associated geopolitical actions are making the working surroundings unsure and difficult. The world premium luxurious phase and Indian home markets are anticipated to climate this comparatively higher,” Tata Motors famous on 13 May. 

Apart from specializing in getting the premium hatchback phase proper, the corporate can be carefully monitoring the traits within the electrical car and hybrid autos markets. 

“Tata Motors has at all times believed that hybrids are an previous expertise. From a sustainability viewpoint, there usually are not many benefits. However, if shopper demand picks up, we may have no subject in beginning the manufacturing of the car,” Srivatsa stated. 

Also Read: Q4 earnings watch: The auto sector is stuck in a profit jam. Why the squeeze?

According to Deloitte’s newest world automotive shopper examine, solely 8% of Indian customers had been eager about pure electrical autos, whereas 33% of the examine’s respondents most popular hybrid vehicles. Tata Motors’ electrical car gross sales declined by 13% within the final monetary 12 months to 64,276 vehicles. 

In 2025 up to now, Tata Motors share worth has declined 4% as in comparison with the 1.81% rise in Nifty Auto. 

“A serious concern for the corporate could be worldwide challenges however a constructive is the truth that JLR continues to be worthwhile. Domestically, the corporate has to be careful for rising competitors consuming into its market share,” Saji John, senior analysis analyst at Geojit Financial Services, stated.