Primary thinking on EV side… requires lot more frugal thinking: Tata Motors Passenger Vehicles MD

The first generation Nexon EV was a derivative of the ICE car. But with the new generation Nexon, did you employ an EV-first approach, since you were designing the two cars at the same time?

There was a joint thinking – of the need coming from the EV side and the natural evolution on the ICE side. The ICE variant has gotten a lot of the benefits from the thinking we did for the EV. They (the ICE version) need not have gone to this level of gadget-isation, for instance… But the primary thinking is here (on the EV side), because this will always be a notch ahead on the technology, and requires even more optimisation of costs. The frugal thinking is even more, because the customer is not ready to pay, so you have to reduce the technology cost.

Is there a tradeoff between passing the reduced costs to the customer and fitting the car with more technology?

There are three opportunities. One is that you see from a range to price perspective. So, either you increase the range and absorb the cost benefit, because the range has still not reached a level where you have full customer confort. Till you get to a real 400 kilometre real world range, you have to continue improving it as the battery prices come down.

Second is that you reduce the price (of the car), because not everyone needs a car with a long range… that is why we have two range options. The third opportunity is feature addition. So the answer (to the question) is a combination of all these three things.

In the long range, you will see some more features as well, and in the medium range, you miss some features… Somebody who is buying the latter is still using this as an additional vehicle and would not like everything in it.

The new individual identity you are trying to create for the EV segment, will that also translate into specific showrooms for the EVs?

Of course. You will start seeing progressively, as in certain cities when it crosses a critical volume threshold where it makes a viable case for exclusive showrooms… in the next few quarters you will see some of them coming up.

Charging infrastructure continues to be a constraint. What percentage of buyers are using the home chargers?

The percentage time users charge the EVs is upwards of 90 per cent… If you get a 320-340 kilometre real world range, you can do a Mumbai to Pune up and down, for instance… actually you never have to stop (for such trips) at a public charger, but typically people do stop. It was a problem when the range was around 230 kilometres in the first one, where venturing on highways was less of a possibility.

So, public charging is not that big of an issue today?

It is a big issue because many people still wouldn’t venture out, even with a 340 kilometre range. They still worry. They would experiment going alone, but not with their family. But, now you have decent infrastructure. There are about 6,000 public chargers now. So on major routes, we attack the key highways. You will not get stranded. You might have to wait slightly because EVs have sold more than the pace at which the charging infrastructure has come up. But, you will not get into a situation where you have no option (of charging an EV).

If somebody is going to the highway, they plan their trip. The range anxiety is not in EV buyers’ mind, but more for non-EV buyers’.

How much of a worry do buyers have with the cost of the battery pack replacement?

We offer a warranty of eight years (on the battery pack). The LFP (lithium iron phosphate) batteries we use have a life of nearly 3,000 cycles, of charge and discharge. It will outlive the car. But at times, certain cells or modules can go bad and you should replace that, but at least for eight years you do not have to think of anything. The warranty is transferable too. What kind of a warranty do you get in an ICE car? We offer around four times more than that.

Petrol variants are typically the cheapest option for any car. EVs are also currently a bit more expensive than the petrol variant of the same car. How long will it take for that to flip?

Should be… battery prices are very dynamic. The scale of EVs increasing globally should bring down the battery prices. Along with that other component costs will also come down with scale. There will be a drastic drop in the price of the technology as the scale enhances.

On the other hand, on the ICE side you are seeing that every emission-related intervention is increasing the price. So, one is seeing an inflationary trend, while the other will see a deflationary one. I don’t know where the two will cross… but hopefully by the end of the decade it should be.