TaMo looks to ace last-mile delivery with sub-600 kg SCV

Tata Motors, India’s largest commercial vehicle manufacturer, is looking to launch a first-of-its-kind sub-600 kg small commercial vehicle, aiming to cater to the growing demand for efficient last-mile delivery solutions, an area currently witnessing a surge in interest from e-commerce giants.

This new entrant is set to be positioned just below the marquee Tata Ace, which is popular across the country as “Chota Haathi”.

Girish Wagh, executive director at Tata Motors and brain behind the Tata Ace that helped revolutionise the last-mile delivery in the Indian market since its launch in 2005, revealed the company’s strategic plans in an interview with Business Standard.

"In e-commerce, hub-to-hub transport is handled by 19-tonne medium commercial vehicles, and some even use 28-tonne three-axle trucks.

"For the last mile, however, smaller vehicles are the key,” Wagh explained.

“We have decided to leverage this demand with a four-wheeler vehicle (diverging from the prevalent three-wheeler models currently dominating the market), featuring a payload capacity under 600 kg.”

Tata Motors’ current offerings begin with the Tata Ace at 600 kg, but there’s untapped potential in the segment below that, said Wagh, adding, “We are exploring what we can do especially with the growth of three-wheelers CVs and specifically due to electrification.

"There are some interesting possibilities in the space below ACE (sub-600 kg).”

Though there is a “need gap” in sub-600 kg space, the Tata Motors’ executive said, “We won’t bring in a three-wheeler here, because a four-wheeler is safer and it also is appropriate for our brand.”

Tata Motors did not share any timeline for the launch of this new vehicle, which is still in the “planning and development” phase.

Tata Ace has been a transformative force since its debut, helping reshape the last-mile delivery landscape in India; it has become the go-to choice for over 2.3 million entrepreneurs, and largest commercial vehicle brand in the country.

In 2001, a then 29-year-old Wagh conceived the Tata Ace to challenge the sub-2-tonne market, then dominated by three-wheelers from Bajaj Auto, Mahindra and Mahindra, and Piaggio.

Now, Tata Motors plans to confront the dominance of three-wheelers once again with its upcoming sub-600 kg four-wheeler small commercial vehicle (SCV).

“Three-wheelers stagnated during the BS IV phase, leading to a shift towards four-wheelers like the Ace,” Wagh noted.

But during the transition from BS IV to BS VI emissions standards, the Ace saw a 30 per cent price increase, compared to only 15 per cent for three-wheelers, and this prompted some buyers to revert to three-wheelers, he said.