Mahindra & Mahindra Ltd. (M&M), which recently lost a 10,000 electric vehicle (EV) supply contract to Tata Motors, has questioned the latter’s aggressive pricing in its bid with the government’s Energy Efficiency Services Ltd. (EESL).
“The price quoted by the L1 bidder [Tata Motors] was significantly lower than us,” M&M managing director Pawan Goenka, said on a conference call. “This price is hard to comprehend. I don’t know on what basis they have priced it.”
He said M&M had been the only Indian company with experience in passenger EV for the last five years, with more than 3,000 vehicles already on the road. On the other hand, Tata Motors was yet to put a single EV on the road, Mr. Goenka said.
‘Ambitious’ project
He said M&M had, however, agreed to match the L1 bidder’s pricing as per the bid conditions since it wanted to participate in the ‘ambitious’ project. It would supply 150 units in the first phase at a loss of ₹3.2 lakh per EV. EESL is procuring 10,000 EVs to replace petrol and diesel powered government cars.
In the first phase, EESL is buying 500 vehicles out of which M&M agreed to supply 150 units at a loss of ₹3.2 lakh per unit.
In the second phase, 9,500 units need to be supplied to EESL. However, M&M is unsure of participating in that phase as it would not afford to incur huge losses.
“We have not made any decision on Phase II. We will look at it later if we can bring the cost down in some way. Our eVerito is bigger in size and it is not possible to bring the size down immediately. We have good knowledge on electric vehicles and know the pricing of suppliers. We find it difficult to comprehend the price quoted by the L1 bidder. We don’t have any knowledge about their battery size, and the vehicle range,” Mr. Goenka said, adding that they were surprised by the aggressive pricing and sudden entry of Tata Motors in the fray without actually having an EV offering.
