The proposed demerger of Tata Motors into two listed entities will bring strategic clarity, enabling long-term returns for shareholders, according to Chairman N Chandrasekaran.

Addressing shareholders in the company's 80th Integrated Annual Report for FY25, he noted that the demerger of Tata Motors into two listed entities -- Commercial Vehicles and Passenger Vehicles (including EV and JLR) -- is progressing as planned.

"The proposed demerger will bring greater strategic clarity and agility, enabling a more focused approach to execution and value creation, delivering superior experiences for customers, rewarding careers for employees, and long-term returns for shareholders," Chandrasekaran said.

In early FY26, shareholders approved the demerger which is expected to be effective during the second half of 2025, with shareholders receiving equivalent shares in both entities, he added.

Elaborating on the road ahead, Chandrasekaran said: "We step into FY26 with confidence in our strategy, strength in our execution, and belief in our people." "We remain vigilant to worldwide volatility, including the impact of changes in global trade conditions and the varying degrees of adoption of electric vehicles across different markets and evolving technologies, to accelerate our production plans while delivering value to our customers," he noted.

The company's focus remains on delivering consistent growth, enriching customer experience, and innovating for a cleaner, safer, and more connected mobility future, Chandrasekaran stated.

"As we grow, we are also embedding greater automation and AI into our operations, enhancing agility and efficiency while shaping a future-ready manufacturing ecosystem," he added.

For Tata Motors, AI/Gen AI presents huge opportunities in all aspects of the business, including how vehicles are conceived, how they are built and how they operate on the road, Chandrasekaran stated.

"AI in vehicles is improving safety, increasing fuel efficiency, and providing drivers with enhanced connectivity features. This is the new context in which we craft our strategies for the future," he said. 

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