TATAMOTORS

Tata Motors expects its ICE vehicle or internal combustion engine margins to remain under pressure in the near term despite cost-cutting measures, as commodity inflation, a weak model mix and heavy industry discounting weigh on ***** said ICE margins have been under stress for some time, with an additional blow from commodity inflation in the June quarter, driven mainly by higher steel prices, safeguard duty of 12 percent and forex risks. While a residual impact will spill into Q2, the company expects some improvement from current ***** margins are likely to stay subdued for the rest of the year as Tata Motors works to exit the calendar year with minimal modular stock. The company is banking on deeper cost-reduction efforts, a better model mix from curated variants of the Harrier and Safari, and possible price hikes in the second half — aided by festive demand — to lift margins by 3-4 percentage points over the next few quarters. In contrast, the EV business has been showing a steady improvement in profitability. Tata Motors said EV margins have been rising year-on-year even without battery localisation incentives, helped by significant cost cuts. The segment reached EBITDA breakeven with incentives in Q1, and management expects further margin gains as the mix improves with the ***** and other models.