With its ‘Turnaround 2.0’ strategy, Tata Motors has been reporting progress in the passenger and commercial vehicle categories. The bus segment, which alone was seeing negative growth, is also witnessing a revival of demand. Sandeep Kumar, Head - Sales & Marketing, Passenger Commercial Vehicles, Tata Motors, spoke about the company’s growth prospects. Excerpts:

The bus segment appears to be seeing some growth this fiscal. What’s driving this growth?

There are multiple factors such as the introduction of the bus body code, increased focus on infrastructure development, rapid urbanisation, low penetration of public transport and affordable housing projects across the country. There has also been a greater emphasis on providing a safe and sustainable means of transport, with the use of state-of-the-art technology and cleaner alternative fuels. Make-in-India is one more step towards the growth of passenger transport. The country certainly needs many more buses for efficient transportation. Each year 90,000-100,000 new buses are sold, but this figure has the potential to more than double as Indian public transport is yet to reach its optimum potential.

This fiscal, we expect the bus industry to grow more than 12-14 per cent and expect this momentum to continue for 5-7 years. We expect it to grow at a CAGR of 8-10 per cent till 2025.

You had lost market share in the bus segment. How are you trying to regain your position?

Tata Motors has not lost market share in buses in FY19. A gain or loss in some sub segment (medium-duty bus) is transient and we are confident of recovering that position shortly. In April-August, Tata Motors gained market share in two out of three sub-segments. Tata Motors has maintained market leadership position in buses (across all three segments — medium, intermediate and light commercial vehicles) for several years. The bus TIV (total industry volume) grew at 15-18 per cent in the first five months of this fiscal. We will continue to grow and further expand our portfolio.

What is the current order book position?

Tata Motors has been a pioneer and market leader in CBU (completely built-up) buses through its joint ventures Tata Marcopolo and ACGL (Automobile Corporation of Goa Ltd). Currently we sell about 75 per cent of our CBU buses in the intermediate and light commercial vehicles (ILCV) segment and about 20 per cent in the MCV segment. We have a healthy order book of about 3,000 units from STUs for MCV buses, as of August 2018.

The commercial passenger carrier segment recorded a steady growth with 4,458 units sold in August, marking a 9 per cent increase over last year. This was led by demand for school/staff buses and vans.

How are the alternative and hybrid fuel vehicles growing in India?

We are witnessing demand in the EV and hybrid buses segments. With early investments in new technologies, we are geared up to further strengthen our market leadership.

We have also won tenders from six out of 10 cities to supply 255 EV buses, which will be delivered in phases starting from October.

The company also showcased its first fuel cell bus (12m), LNG powered bus (12m), and 18m articulated bus. Developed indigenously, these buses are safe, comfortable and economically viable. We are the first company in India to showcase LNG buses.

What is the growth outlook for the bus segment this year?

The major emphasis currently is on finding cleaner alternative fuels for use in public transportation. The market for low-floor AC city buses is also witnessing a growth due to the rising demand for ‘comfortable’ travel. There is also an increase in demand for automatic transmission buses as it helps reduce driver fatigue.

We believe the three segments — public transport, school/staff, and tour/travel — will witness good growth in the near future. The penetration of public transport in very low in India, especially in the rural areas. We are also seeing demand in the school buses segment. We would wish to see every school-going child in India have access to school transport.

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