Tata Motors to widen BaaS beyond Punch.ev to lift entry-level EV adoption

Tata Motors aims to drive EV uptake in the sub-Rs 12 lakh segment by extending battery-as-a-service beyond Punch.ev, targeting buyers who need lower upfront prices and usable range

Tata Motors is pivoting its EV strategy around a hard reality: Mass adoption in India depends on cracking the sub-Rs 12 lakh segment. Starting with the refreshed Punch.ev, the company introduced its first battery-as-a-service (BaaS) model to lower upfront costs, with plans to roll out the option across entry-level models including the Tiago.ev.

 

The company launched the updated Punch.ev at Rs 9.69 lakh (ex-showroom, Mumbai) — with an optional BaaS structure starting at Rs 6.49 lakh plus a battery usage charge of Rs 2.6 per km — as it woos the entry segment that accounts for nearly two-thirds of domestic passenger vehicle demand, yet remains a marginal market for EVs.

 

 

The price band is the hardest to crack, according to Shailesh Chandra, managing director of Tata Motors Passenger Vehicles Ltd. and Tata Passenger Electric Mobility. “Below Rs 12 lakh, the EV market is negligible,” he said, pointing to structural constraints such as limited GST arbitrage, tight price points and the need to offer sufficient real-world range for single-car ownership.

 

In the sub-Rs 12 lakh segment, where over 3 million passenger vehicles (PVs) are sold annually, EV penetration languishes at 1.5 per cent. That is in stark contrast to the above-Rs 12 lakh segment, where EV adoption has hit 10 per cent. Across the total 4.2 million-unit PV market, overall EV penetration currently hovers between 4-5 per cent, with Tata Motors maintaining its lead.

 

That is also why Tata Motors is extending BaaS beyond Punch.ev to other entry-level EVs, including Tiago.ev. But Chandra is clear about what BaaS actually is — and what it is not. “It is not really a service. It is a twin-EMI structure,” he said, adding that the service’s adoption is low at around 2-3 per cent.

 

BaaS is a visualisation tool, rather than a decisive buying trigger. It helps customers compare EV ownership with petrol cars by splitting the vehicle cost into two loan EMIs — one for the car and one for the battery — mapped to a per-kilometre running cost. “My real instrument is not BaaS. My real instrument is the value proposition of the car,” Chandra said, noting that the buying decision is shaped by actual sticker price and not financing.

 

Refreshing Punch.ev is part of the company’s efforts to remove practical barriers in the entry segment. By offering new 30 kilowatt-hour and 40 kWh battery options, Tata is repositioning Punch.ev from being largely a second or third city car to a viable single-car option capable of intercity use. Chandra expects monthly sales to climb 30-50 per cent from the current 1,500–1,800 units as improving range confidence drives demand.

 

Tata Motors is steadily shifting the Punch portfolio away from its internal combustion engine (ICE) mix. EV penetration within the portfolio stands at 10 per cent, while total clean-energy share — EV plus CNG — has climbed to 43 per cent (comprising 17 per cent EV across the series and 26–27 per cent CNG). Chandra expects EV penetration for Punch to reach 15–20 per cent in the near term, eventually stabilising at 25–30 per cent by 2030.

 

EVs account for 30-40 per cent of Tata Motors’ local sales in markets such as Jaipur and Kerala, driven by home charging, solar adoption and dense urban clusters. Chandra sees this pattern spreading outward — from cities to nearby towns and rural pockets as early adopters complete four to five years of ownership.

 

Crucially, Tata Motors is open to breaking its EV and ICE design linkage. Chandra noted that future EVs may feature body styles with no ICE counterparts. While Tata currently uses familiar “top hats” to drive scale and customer acceptance, he emphasised that the underlying architecture is already a pure EV platform rather than a conversion. Sharing design elements, he added, is a strategic decision for cost and volume — not a technological compromise.

 

Tata Motors is near full capacity utilisation and uses partner facilities as well. The next phase will involve debottlenecking existing plants, improving flexibility, and selectively expanding brownfield capacity, before considering greenfield investments as volumes scale.

 

Tata Motors is confident of meeting the government’s tightening of Corporate Average Fuel Efficiency norms. As its EV models such as Punch, Tiago and Nexon sell wider, compliance becomes structurally easier. The company is targeting overall EV penetration of around 30 per cent by 2030, driven by success in the entry segment.

 

The strategy is deliberately unflashy: No aggressive discounting, no market-share-at-any-cost play, and no overreliance on financial constructs. Tata Motors is betting that EVs will become widely popular when entry-level buyers see them as normal, rational choices — not experiments.