“The fifth year had been really challenging… we lost nearly 35,000 units in Altroz,” Chandra said, attributing the decline to the car’s ageing lifecycle. He added, “This year, it should see a revival, and that should really help us significantly in terms of both volume growth and market share growth.”
The new Altroz, launched at ₹6.89 lakh, features a modern design, plush interiors, and tech upgrades aimed at repositioning it in the competitive premium hatchback segment. According to Chandra, the redesign brings “more modern and strikingly agile” styling, including elements like flush door handles and wider proportions, which “elevated this car in the premium hatchback segment.”
Recovering volumes is a top priority for the company, especially after Tata Motors slipped to third place in FY25 behind Maruti Suzuki and Hyundai. Chandra said the goal is to maintain a 20–25% market share in every segment the company operates in, including hatchbacks, which have seen industry-wide declines.
On the SUV front, Tata Motors continues to ride the success of the Punch and Nexon models, with new launches like the Sierra expected later in the year. “We expect to have industry-beating growth this year,” Chandra noted, pointing to a strong pipeline of product refreshes and new models.
Chandra also confirmed that market share gains will be gradual but consistent through FY26: “You will see our market share increasing throughout the year.”
The company’s product strategy will include both internal combustion engine (ICE) models and electric vehicles (EVs). Alongside the Altroz, two more refreshes are lined up, along with new launches such as the Harrier EV, Sierra EV, and Sierra ICE.
However, Chandra flagged concerns in the entry-level hatchback segment, which continues to face pressure due to shifting consumer preferences and competition from used cars. “Some customers are seeing used cars as an alternative… the entry hatch segment will face more stress than the industry average,” he said.
In EVs, Tata Motors is aiming to defend its leadership position through a multi-pronged strategy that segments the market into four categories: entry, mid, premium, and fleet. While the company dominates the entry segment with Tiago and Punch EVs, it is planning a stronger push in the ₹12–20 lakh category—where it has lost share—and the premium segment with upcoming launches like the Sierra and Harrier EV.
“Our goal is to enhance the value proposition of Tiago and Punch further… In the mid-to-long term, we aspire to hold a 50%+ market share,” Chandra said, outlining the company’s roadmap to stay ahead in an increasingly competitive EV market.
Below is the verbatim transcript of the interview.
Q: Could you give us a sense of how much the Altroz contributes to Tata Motors’ sales, percentage-wise? And how do you expect to increase this with the latest upgrade?
Chandra: At the start of the interaction, you mentioned that it is getting a refresh after five years. The fifth year had been challenging, which was the last financial year, due to the ageing of Altroz. The peak volume it had achieved was in FY24, just a year back, at nearly more than 70,000 units. But that halved in the last financial year. That’s the reason why our market share came under stress, we lost nearly 35,000 units in Altroz. This year, it should see a revival, and that should help us significantly in terms of both volume growth and market share growth.
Q: Could you give us a sense of the offtake you’re looking at monthly, production-wise at least?
Chandra: I’ve kind of given a hint, but typically, in any segment we are present in, we aspire to hold a market share of about 20 to 25%, which means being among the top two or top three selling cars in that segment. That’s the aspiration. The segment size is about three to three and a half lakh units a year, so you can do the math.
Q: So clearly, it’s going to be very important for you to claw back your market share. The reason I’m talking about market share is that the retail data shared by the Federation of Automobile Dealers for April and FY25 shows a marginal decline in your market share by at least a percent. So, you’re saying that the low sales volume for the Altroz was the biggest reason for this, and you feel that with this new launch, you will be able to claw back that share?
Chandra: The industry last year was a tale of two cities. Hatchbacks declined by about 13%, and SUVs grew by about 10.5% or 11%. Therefore, the players who had exposure to both SUVs and hatchbacks pretty much mirrored the slowdown in the industry. But SUV-heavy players did see the benefit, given the growth rate in the SUV segment.
As far as we are concerned, in the SUV segment, we had industry-beating growth of nearly 11.5% to 12%. In hatchbacks, which declined by 13% in the industry, our decline was more than 30% because of the ageing of two products we have in the hatch segment: the Tiago, which was also in its fifth year and required major intervention, and the Altroz. We lost nearly 50,000 to 60,000 units compared to FY24 because of ageing issues and the overall decline in hatchbacks.
We launched the model-year intervention with a new Tiago in January 2025, and in Q4 we saw a significant jump in Tiago, bringing volumes back to earlier levels. Now we have Altroz, which had seen a significant decline, also coming with a strong refresh. Therefore, we now have a very low base effect from FY25. Hatchbacks should be the area where our growth rate will be extremely high.
On the SUV side, you’re seeing the continued success of Punch and Nexon. We now have the full year for both Nexon CNG as well as Curvv. We are going to add another product, the Sierra, in the second half of this financial year. So, there’s a lot of action in SUVs as well. On both fronts, hatchbacks and SUVs, we clearly see a strong revival, and we expect to have industry-beating growth this year.
Q: Do you believe that it would be in Q1 when we see Tata Motors clawing back market share, or it will be more towards Q2?
Chandra: You will see our market share increasing throughout the year.
Q: Also, about the product onslaught from Tata Motors this year. Last year, we saw muted demand across the industry, and now you’re coming up with new products almost every month or every two to three months. What kind of product offensive can we expect from Tata Motors?
Chandra: Our refreshes are going to be timely. You’ve already seen the new Altroz. There will be one or two more refreshes this financial year. Then there’s the expansion of the EV portfolio, with the Harrier and Sierra also coming this year. On the ICE portfolio side, there will be a new nameplate which is Sierra ICE. So, you’ll see a lot of action throughout the year.
Q: How would you describe the current market sentiment, especially in the entry-level segment?
Chandra: At the industry level, and this applies to all consumer-facing industries, there has been a bit of a slowdown for the last one and a half years. That trend seems to be continuing. We are seeing similar moderate growth patterns as we did in FY25.
Specifically, in the entry segment, and if you look at the hatchback segment, which has been declining as a share of total industry volume, there is a gravitation toward the premium hatchback segment. This is happening at the cost of a significant decline in the entry hatchback segment.
So, I think the entry hatch segment will remain under pressure. Some of the customers who would consider an entry hatch are also seeing used cars as an alternative. So, I believe the entry hatch segment will face more stress than the industry average.
Q: What would be your full-year estimate for FY26, not just for Tata Motors, but at an industry level for passenger vehicles?
Chandra: We expect very moderate growth, similar to what we saw in FY25. That’s broadly the consensus we are hearing from forecasting agencies and our industry peers. Based on the demand trends over the last five to six months, we expect that to continue, so we’re projecting moderate growth.
Q: When it comes to electric passenger vehicles, Tata Motors is still in pole position, but the pie is increasing. More players are entering the market, and their sales are rising month after month. There’s a lot of competition. What would you be doing to navigate this competition? You have the Harrier EV and Sierra EV coming up, but what are the broader plans to ensure continued momentum?
Chandra: We are segmenting the electric vehicle industry into four parts now, as it grows in size. One is the entry segment, mostly city cars, priced below ₹12 lakh. Then there’s the ₹12–20 lakh segment, which is seeing intense competition, as most new models are being launched here. There’s also good potential emerging in the above ₹20 lakh segment. And finally, there’s the fleet segment.
Let me talk about our position in these four segments. We are not currently present in the above ₹20 lakh segment, but we’ll enter it with two strong products: the Sierra EV and Harrier EV. That should help expand our volumes.
In the entry segment, with Tiago and Punch, we are the dominant player, holding a 75% market share. It is the mid-segment (₹12–20 lakh) where we’ve lost the most market share. Our goal is to enhance the value proposition of Tiago and Punch further to expand that segment. We’re also working to strengthen the Nexon and Curvv in terms of the value they offer to customers at specific price points, helping us regain lost share in that category.
In the fleet segment, we want to expand consideration among buyers. Until now, it’s been limited to employee transport and a few EV-focused shared mobility companies. So we are trying to make our EV offerings in the fleet segment deliver value similar to CNG vehicles. That work is in progress.
In the short term, these are the actions we’re taking across all four segments to strengthen both volume growth and market share. In the mid-to-long term, we aspire to hold a 50%+ market share. To achieve that, apart from the short-term actions, we’ll also renew our portfolio with more promising products in the 18 to 24-month timeframe and beyond. That’s something we’ll talk about at the appropriate stage.