Tata Motors, one of India’s largest automobile manufacturers, has reported an 8.47% year-on-year decline in total sales for Q1 FY26, reflecting challenges across its commercial vehicle (CV) and passenger vehicle (PV) businesses amid slowing domestic demand and supply chain disruptions in certain segments.
The company sold 2,10,415 units in the April-June 2025 quarter, down from 2,29,321 units in Q1 FY25, according to its stock exchange filing on Thursday. Analysts attribute the decline to weak rural demand for commercial vehicles, delayed replacement cycles, and heightened competition in the passenger EV segment.
🔍 Tata Motors Q1 FY26 Sales Summary
| Segment | Q1 FY26 Sales (Units) | Q1 FY25 Sales (Units) | YoY Change (%) |
|---|---|---|---|
| Total CV (Domestic + Exports) | 75,540 | 83,945 | -10.01 |
| Total PV (Domestic + Exports) | 1,34,875 | 1,45,376 | -7.23 |
| Grand Total | 2,10,415 | 2,29,321 | -8.47 |
(Source: Tata Motors regulatory filing, July 2025)
🏦 Commercial Vehicle Segment Performance
The commercial vehicle business reported a 10.01% decline in total sales to 75,540 units, primarily due to muted demand in the MHCV (Medium & Heavy Commercial Vehicle) sub-segment and subdued construction activity in some states during the pre-monsoon quarter.
| Sub-Segment | Q1 FY26 Sales (Units) | Q1 FY25 Sales (Units) | YoY Change (%) |
|---|---|---|---|
| MHCV | 19,540 | 22,340 | -12.55 |
| ILCV | 10,900 | 12,050 | -9.53 |
| SCV & Pick-up | 37,600 | 41,300 | -8.95 |
| Passenger Carriers | 7,500 | 8,255 | -9.14 |
🗣️ Tata Motors’ Management Commentary
In its official statement, Tata Motors said:
“The CV industry continues to face headwinds due to delayed fleet replacement demand and cautious freight operators. However, Tata Motors remains confident of revival in H2 FY26 with improved infrastructure spends and rural demand recovery post-monsoon.”
🏎️ Passenger Vehicle Segment Performance
Tata Motors’ passenger vehicle sales dropped by 7.23% to 1,34,875 units in Q1 FY26, compared to 1,45,376 units a year ago. The decline is attributed to:
- Normalisation of pent-up demand seen in FY25
- Stiff competition in the EV market with new launches from Mahindra, Hyundai, and MG Motor
- Moderation in urban discretionary spending amid rising EMIs
| Sub-Segment | Q1 FY26 Sales (Units) | Q1 FY25 Sales (Units) | YoY Change (%) |
|---|---|---|---|
| ICE PV | 1,06,780 | 1,16,300 | -8.19 |
| EV PV | 28,095 | 29,076 | -3.38 |
🔋 EV Business Outlook
Despite the drop, Tata Motors remains the market leader in electric passenger vehicles with a 70% market share, driven by its Nexon EV, Punch EV, and Tiago EV models.
| Model | Q1 FY26 Sales (Units) |
|---|---|
| Nexon EV | 14,200 |
| Tiago EV | 8,750 |
| Punch EV | 5,145 |
The company plans to launch the Curvv EV and Harrier EV later in FY26, targeting a total EV volume of 1.2 lakh units this fiscal, according to PB Balaji, CFO of Tata Motors.
🏆 Key Highlights From Tata Motors Q1 FY26 Report
| Parameter | Details |
|---|---|
| Total sales | 2,10,415 units (-8.47% YoY) |
| Domestic PV market share | ~13.6% |
| Domestic CV market share | ~44.2% |
| EV share in PV volumes | 20.8% |
| Export volumes | 8,580 units (-9.7% YoY) |
🗣️ Analysts’ Views
Mitul Shah, Research Head, Reliance Securities:
“The Q1 decline was expected given weak rural CV demand and rising competitive intensity in PVs. However, Tata Motors’ upcoming EV launches and recovery in infra-led MHCV demand could drive H2 growth.”
Prabhudas Lilladher Auto Sector Report:
“Cost controls, price discipline, and EV ramp-up remain crucial. Any delay in EV launches or steep market share erosion in ICE PVs could impact FY26 margins.”
🔬 Recent Strategic Developments
- Tata Motors to demerge CV and PV businesses into separate listed entities by FY27 to enhance shareholder value and business focus.
- Investment of Rs 16,000 crore over the next three years in EVs, battery packs, and advanced technologies.
- New CV launches in the pipeline include upgraded Prima and Signa MHCV models with enhanced safety and fuel efficiency features.
- Global expansion focus on South Africa, ASEAN, and Middle East for commercial vehicles and EV exports.
💡 Industry Context
India’s automobile industry faced a marginal slowdown in Q1 FY26, as reported by SIAM, due to:
- Rising interest rates affecting auto loan EMIs
- High base effect from last year’s pent-up demand
- Unseasonal heatwaves in April-May affecting rural sentiments
- Delay in new vehicle launches in some segments
🔮 Tata Motors FY26 Outlook
| Guidance | Management Expectation |
|---|---|
| Total volume growth | 7-9% YoY for FY26 |
| EV sales target | 1.2 lakh units |
| CV growth | Recovery in H2 led by MHCV demand |
| Margin guidance | Consolidated EBITDA margin of 11-13% |
✅ Key Takeaways
- Tata Motors’ total sales declined by 8.47% in Q1 FY26 to 2,10,415 units, driven by broad-based weakness in both commercial and passenger vehicle segments.
- CV sales fell by 10.01% while PV sales dropped 7.23%, despite strong EV volumes.
- Management remains optimistic about demand revival in the second half of FY26 with upcoming EV launches and infrastructure-led CV demand recovery.
- Analysts recommend closely tracking EV market share, ICE PV competitive dynamics, and MHCV replacement cycle trends as key stock drivers in FY26.
📌 Disclaimer
This news content is for informational and editorial purposes only. Data has been sourced from Tata Motors investor filings, SIAM reports, and brokerage research. Readers are advised to follow official company filings and exchange releases for final audited financial results and guidance.
