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Underlining the efforts for localization in its electric vehicles, Tata Motors said it recognized Rs 527 crore as incentives under the government’s production-linked incentive (PLI) scheme for automobile and auto components during the financial year 2025.
“In FY25, we recognised PLI incentive of ₹527 crores on receipt of approval and money for FY24 and also accrued for FY25 basis TCA approval,” the company said in its annual report.
The government launched the Rs 25,938 crore output-linked incentive in 2021 to boost domestic manufacturing of advanced automotive technology (AAT) products and attract investments in the automotive manufacturing value chain.
Incentives are applicable on the “determined sales value” which is defined as the incremental eligible sales of a particular year over the base year.
Under the scheme, incentives are offered ranging from 13% to 18% for components of electric vehicles and hydrogen fuel cells while other AAT products receive incentives between 8% and 13%.
Tata Motors received incentives of Rs 142.13 crore for determined sales for the financial year 2024. The eligible sales of AAT products from Tata Motors included the Tiago EV, Starbus EV, and Ace EV, totaling Rs 1,380.24 crore.
“For FY25, the group has accrued income of Rs 385 Cr, on those products where Domestic Value Addition (DVA) criteria was met and Techno Commercial Audit (TCA) completed,” the company said.
The total Rs 527 crore in PLI incentives claimed includes Rs 352 crore for the passenger vehicle division and Rs 175 crore for the commercial vehicle division.
Tata Motors is currently the largest electric passenger car maker in India with sales of 64,269 units in FY25.
“In the EV segment, we became one of the few global manufacturers to achieve positive EBITDA, on the back of a higher level of localisation, aggressive cost reduction, and securing PLI benefits,” said Shailesh Chandra, managing director of Tata Motors Passenger Vehicles and Tata Passenger Electric Mobility.
The company is banking on localization as a key differentiator in its strategy with 75-80% localisation at tier 1 level.
“This high degree of localisation provides significant agility, cost advantages, and enhanced supply chain resilience. Beyond operational benefits, it also contributes meaningfully to the long-term growth of India’s EV ecosystem,” the company said.
“Our strong localisation efforts have further enabled us to qualify for and secure benefits under the government’s PLI scheme, which we will use to fund our future investments into sustainable mobility.”
This article first appeared on Autocar
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