Not pressing panic button on rare-earth supplies: Tata Motors

'The reported deal between the European Union and China should mitigate it (shortage) for the medium to long term. Let's wait and watch how this plays out.'

Tata Motors, the country's largest electric vehicle (EV) manufacturer, has said it has a "comfortable" stock of rare-earth magnets for the next few months.

The supplies from "current sources" are coming and there are no plans of any production cuts at this point, a senior company official said.

Speaking to reporters in Mumbai, P B Balaji, group chief financial officer, said the shortage issue would be managed through inventories and exploring alternative sources.

"The reported deal between the European Union and China should mitigate it (shortage) for the medium to long term. Let's wait and watch how this plays out. We are not pressing the panic button and no production cuts are being planned," he said.

The company is tracking the situation and has no plans to postpone any of their upcoming launches.

Tata Motors Passenger Vehicle and Tata Passenger Electric Mobility Managing Director Shailesh Chandra said the companies' action had stabilised its launch dates.

The Sierra EV will be launched later this year.

Chandra further said if the situation deteriorated then the firm might take a fresh look at things. Dispatches of the Harrier EV will start next month.

For the short term one is dependent on inventories, which are comfortable for the next few months, he said.

Discussion between Society of Indian Automobile Manufacturers and Automotive Component Manufacturers Association of India (Acma), on the one hand, and the ministry of commerce, on the other, is on.

"We have identified seven rare-earth elements, and will see in the medium term how we can reduce work dependence and bring down the constitution or a mix of these into the components. In the long term we will see how we can eliminate (use of magnets in components)," Chandra told reporters.

Open to hybrids if market demands

The company said if there was a market for it, it was open to hybrid powertrain.

It said its stance had always been clear-hybrids were not a "destination technology".

Balaji said: "We are fine with supplying hybrids if that's what the customer wants, but our only issue has been around incentivising hybrids, saying that this is not a destination technology but it is an 'intermediate transition technology' and it will be used for managing CAFE (corporate average fuel efficiency) norms."

Tata Motors is targeting a 30 per cent share from electric (by 2030) and 25-27 per cent from CNG (compressed natural gas) powertrains, 6-7 per cent from diesel, and the rest from petrol vehicles.

"In petrol, if competition requires bringing in hybrids, we will do that and it might not just be for emission but performance also. We will always be open to using technology to meet the value that we want to deliver to the customer," Balaji said.

Maruti Suzuki, Toyota Kirloskar, and Honda have hybrid options. Hyundai, Mahindra & Mahindra, Kia, JSW MG Motor, Skoda, and Volkswagen are planning hybrid vehicles for the Indian market.

Avinya launch delayed to 2026

The launch of the all-electric Avinya, which will be a different brand altogether, has been postponed to FY26 because the car underwent some changes in subsystems.

The company showcased two concepts around 2022 and Chandra had then said he was optimistic that in two and a half years the firm would be able to bring the car to the market.