EVs to account for 12% of India's vehicle sales
What's the story
The Indian electric vehicle (EV) market is gearing up for a major expansion. A new report from ratings agency Ind-Ra has predicted that EVs will account for 10-12% of total vehicle sales in FY27, up from the 8.5% recorded in FY26. The growth will be driven mainly by electric two-wheelers, which are expected to see their penetration rise to between 8-10% during this period.
Growth drivers
Growth in electric passenger vehicles from small base
The expected rise in electric two-wheeler penetration is attributed to several factors.
These include lower operating costs, easy home-charging solutions, and an expanding product portfolio from existing automakers.
Ind-Ra also predicts that electric passenger vehicles will see significant growth from a small base, with their market share rising to between 6-8% during FY27.
This growth will mainly be driven by the introduction of new models into the market.
Market dominance
Electric 3-wheelers to remain most electrified vehicle category
Electric three-wheelers are expected to remain the most electrified vehicle category in India, with their penetration increasing to between 62-65% in FY27.
This growth is mainly driven by attractive operating economics for commercial operators and continued government support.
Ind-Ra also predicts that electric bus penetration will increase to between 6-8% during this period, aided by strong order books and government procurement programs.
Urban focus
Ind-Ra report warns of slow electrification in long-distance mobility segments
Ind-Ra's report also highlights that electrification in long-distance mobility segments will be slower.
This is because consumers are still weighing the higher upfront costs, charging accessibility, and driving range.
The agency predicts that EV adoption will be concentrated in metropolitan markets and higher-income consumer segments.
"The next phase of India's EV growth will depend on the development of a robust domestic value chain," said Shruti Saboo, Director at Ind-Ra.