TI invest ₹320cr in Clean Mobility electric truck
The company is strategically expanding production in four vehicle segments.
Murugappa Group to invest ₹320 crore in electric small truck plant in Chennai.
TI Clean Mobility’s major investment and strategic expansion in electric vehicles and TI invest ₹320cr in Clean Mobility electric truck
Investment and factory setup
Capital Expenditures and Allocations:
TI Clean Mobility, the electric vehicle arm of the Murugappa Group, has earmarked capital expenditure (capex) of around ₹471 crore.
TI invest ₹320cr in Clean Mobility electric truck , has been allocated to setting up a factory in Chennai. This facility will focus on manufacturing electric small commercial vehicles.
Production Capabilities:
TI Clean Mobility is expanding its production capabilities in four key vehicle segments:
- electric small commercial vehicles
- electric heavy commercial vehicles
- electric tricycle
- electric tractor
Anticipated Production Capabilities:
Annual Production Estimate:
Company management shared its estimates during the Q4FY24 earnings call:
- Electric three-wheeler: Around 75,000 units.
- Electric small commercial vehicles: approximately 50,000 units.
- Electric tractors: approximately 25,000 units.
- Electric heavy commercial vehicles: About 4,500 units.
Launch Plans and Branding:
Launch Timeline:
TI Clean Mobility is set to launch its electric small commercial vehicle under its subsidiary Tivolt Electric Vehicles in the second quarter of this financial year.
These vehicles will be marketed under the Montra brand, which is already in use to sell electric three-wheelers.
Electric Three-Wheeler Business:
Sales Impact and Plan Changes:
The electric three-wheeler segment faced a decline in sales due to the transition from the FAME scheme to the new EMPS scheme.
Sales across the industry declined from 61,000 units in March 2024 to around 42,000 units in April 2024.
TI Clean Mobility sales dropped from 500 units per month during the fourth quarter of fiscal 2013 to about 200 units in April due to subsidy changes.
Price Adjustment and Cost Absorption:
In response to the subsidy scheme change, the company implemented a price increase for its electric three-wheelers and absorbed some costs to mitigate the impact.
Market Expansion and Dealership Network:
Geographical coverage:
The Montra electric autorickshaw, which is currently sold in the southern market, is expected to enter the northern market by the end of the financial year.
Dealership Growth:
The company has set up 63 dealerships and plans to double this number by the end of the financial year.
Additionally, TI Clean Mobility is developing a cargo version of its three-wheeler, which is undergoing homologation processes.
Electric Truck Segment:
Order Complete:
TI Clean Mobility has an order backlog of 35-40 electric trucks, which it expects to complete by May or June.
Currently, 70 electric trucks are in operation, and the company is approaching several large customers for additional orders.
Electric tractor:
Launch Plans:
There are plans to launch the electric tractor in the third quarter of this financial year.
Funding and Development Initiatives:
Fundraising Efforts:
To support its expansion and growth, TI Clean Mobility is actively raising funds.
The company has already secured around ₹2,530 crore out of the target ₹3,000 crore.
Strategic Development:
TI Clean Mobility’s significant investment and strategic expansion into various electric vehicle segments underlines its commitment to advancing sustainable transportation solutions.
With a strong plan to increase production capacity, launch new models and expand its market reach, the company is set to make a substantial impact in the electric vehicle industry.
Commitment to sustainability:
This strategic move is in line with the global effort towards sustainable and eco-friendly transportation, reinforcing the Murugappa Group’s dedication towards innovation and environmental stewardship.
Conclusion
TI Clean Mobility, a division of the Murugappa Group, is investing ₹471 crore to boost its electric vehicle production. Of this, TI invest ₹320cr in Clean Mobility electric truck The company is expanding its range to include electric three-wheelers, small commercial vehicles, heavy commercial vehicles and tractors Despite challenges from changes in subsidy schemes, TI Clean Mobility plans to launch its new electric small commercial vehicle under the Tivolt brand and expand its Montra autorickshaw market. The company has secured ₹2,530 crore out of the targeted ₹3,000 crore to support these growth initiatives.