India’s Tata Motors in talks with hybrid engine, fuel cell makers

India’s Tata Motors in talks with hybrid engine, fuel cell makers

India’s Tata Motors said on Tuesday it was talking with makers of hybrid engines and fuel cells such as Ballard Power Systems about the possibility of using their technology in future car models.

Tata group Chairman Ratan Tata said India’s third largest maker of passenger cars needed a partner because it did not have the resources to develop ecologically friendly technology by itself.

“The area where we have a lot to do is the area of alternative fuels … powertrains, hybrids, fuel cells,” he told Reuters in an interview at the Geneva auto show.

“A company like ours is unable to put large budgets into those types of developments,” he said, adding that Tata could eventually license the technology to use in its cars.

Among the companies Tata was speaking to were Canadian battery-maker Ballard and car makers in Japan and Europe, Tata said. The Indian maker was also talking with Italy’s Fiat , which is already a partner in making engines, trucks and other products.

Fiat makes engines that run on both gas and ethanol.

Based in Vancouver, B.C., Ballard develops zero-emission fuel cells for power generation and automotive partners such as DaimlerChrysler .

Tata said the Indian automaker was looking to expand in eastern Europe after making a small entry into Italy and Spain, where it sold a combined total of about 7,000 units last year.

“We will never be one of the major brands in Europe (but) we are looking for a presence that will be a stable presence … We probably will not be in all of Europe, but mostly on the southern side,” he said.

Tata is due to debut in the UK later this year.

“We don’t have a brand in the automotive segment,” he said. “This is something we will have to build.”

Tata aims to sell 12,000 to 15,000 units per year each in Italy and Spain in three year’s time.

Other markets where it is looking to expand included Africa and Latin America, he said.

“The United States is a very demanding market,” he said. “I would like to succeed in other geographies first before I endeavour to … address the United States.”

Tata said he preferred to grow internally rather than through acquisitions.

“We will not be in the market for acquisitions for the sake of growing our top line,” he said. “We may have partnerships or make acquisitions where there is a product or technology gap that we could use — but it would be very strategic.”