Tata Motors has won the first government contract for supplying 10,000 electric variants of the Tigor, its sedan car. outbidding Mahindra & Mahindra (M&M) in the contest for the Rs1,120 crore order.
Interestingly, the home-grown auto major does not have any electric car in its portfolio.
In the largest such procurement anywhere in the world, Energy Efficiency Services Limited (EESL) will procure 10,000 electric vehicles from Tata Motors Limited.
Tata Motors quoted the lowest price of Rs 10.16 lakh, exclusive of GST, in the bidding process. The vehicle will be provided to EESL for Rs 11.2 lakh, which will be inclusive of GST and a comprehensive 5-year warranty. At this price, the car will cost 25% less than the current retail price of a similar e-car with a 3-year warranty.
EESL, a joint-venture comprising four government-owned power sector entities — NTPC, Power Grid, Power Finance Corp and Rural Electrification Corporation, floated a global tender in August for such numbers of e-vehicles as part of a plan to replace the five-lakh petrol and diesel cars used by the government and its agencies over a 3-4 year period.
Along with procurement of 10,000 EVs, EESL will also identify a service provider agency. This agency, also appointed through competitive bidding, will carry out end-to-end fleet management of the procured vehicles for the concerned government customer.
The first 500 electric vehicles will be supplied to EESL in November and the remainder will be delivered in the second phase, the report said.
Mahindra quoted Rs 13 lakh and has the option of matching the bid of Tata Motors to win 40% of the contract.
“Three companies had sent their bids yesterday. Nissan (Motor Co. Ltd) could not qualify for the bid as they could not indicate what product they are going to offer,” said Saurabh Kumar, managing director of EESL.
He further added, “We will talk to Mahindra to lower their cost. If they agree on lower prices, they will be given the remaining 40% order. In an alternative situation, the entire order will go to Tata Motors.”
Tata Motors will supply the electric version of its Tigor sedan, for which batteries will be imported. However, the company has offered to supply only 250 cars of the 500 sought in the first phase as India plans to replace its petrol and diesel-run vehicles with an all-electric fleet by 2030.
Tata Motors is also learned to be working on electric variant of its two entry-level cars — the Nano and Tiago
“The EESL tender provided us the opportunity to participate in boosting e-mobility in the country and at the same time accelerate our efforts to offer a full range of electric vehicles to Indian consumers,” said Guenter Butschek, CEO of Tata Motors.
At present, less than 1% of the 200 million vehicles on Indian roads are estimated to be electric vehicles.
As per industry data, electric car sales in India, one of the world’s fastest-growing car markets, are negligible compared with annual sales of over 3 million petrol and diesel cars last fiscal year.