India Electric Car Market SIZE & SHARE ANALYSIS - GROWTH TRENDS & FORECASTS UP TO 2029

India Electric Car Market Trends

Government initiatives and stringent norms drive rapid growth in the electric vehicle market in India

• India's electric vehicle (EV) market is in a growth phase, with the government actively formulating strategies to combat pollution. The Fame India scheme, launched in 2015, has played a pivotal role in driving vehicle electrification. Building on its success, Fame Phase 2, active till April 2022, further bolstered EV sales, especially in 2021, with the government offering subsidies like INR 10,000 grants for electric cars with battery capacities up to 15 kWh.
• State governments across India are increasingly incorporating electric buses into their fleets, aiming to transition from internal combustion engine (ICE) buses. This move not only cuts operational costs but also curbs carbon emissions and improves air quality. In a notable move, the Delhi government greenlit the procurement of 300 new low-floor electric (AC) buses in March 2021, with 100 of them hitting the roads in January 2022. These initiatives contributed to a significant 62.58% surge in demand for electric commercial vehicles in India in 2022 over 2021.
• The demand for electric cars has surged in recent times, driven by the government's introduction of stringent norms. In August 2021, the Indian government unveiled the Vehicle Scrappage Policy, targeting the phasing out of polluting and unfit vehicles, irrespective of their age. This policy, set to be implemented by 2024, is steering consumers toward electric cars. Additionally, the government has set an ambitious target of having 30% of all cars in India electrified by 2030. These initiatives are poised to propel electric car sales during the 2024-2030 period in India.

OTHER KEY INDUSTRY TRENDS COVERED IN THE REPORT

Segment Analysis: Vehicle Configuration

SUV Segment in India Electric Car Market

The Sports Utility Vehicle (SUV) segment dominates India's electric passenger car market, commanding approximately 73% market share in 2024, with sales reaching 129,124 units. This commanding position can be attributed to several factors, including the growing consumer preference for vehicles that offer higher ground clearance, spacious interiors, and robust build quality suitable for Indian road conditions. The segment's popularity is further bolstered by the introduction of multiple electric SUV models across different price points, making them accessible to a broader consumer base. Major automotive manufacturers have strategically focused on launching electric SUVs, recognizing the segment's strong market potential and consumer demand. Additionally, technological advancements in battery technology and electric vehicle charging infrastructure have addressed range anxiety concerns, making electric SUVs more practical for both urban and inter-city travel.

Hatchback Segment in India Electric Car Market

The hatchback segment is emerging as the fastest-growing category in India's electric car market, projected to experience remarkable growth between 2024 and 2029. This surge is driven by increasing consumer demand for affordable and compact electric vehicles, particularly in urban areas where maneuverability and parking convenience are crucial factors. Automotive manufacturers are responding to this trend by introducing new electric hatchback models with improved range capabilities and competitive pricing strategies. The segment's growth is further supported by government initiatives promoting electric mobility and the expanding charging infrastructure across major cities. Additionally, technological improvements in battery efficiency and reduced production costs are making electric hatchbacks more accessible to price-sensitive Indian consumers. The segment's appeal is enhanced by lower maintenance costs and the growing environmental consciousness among urban dwellers.

Remaining Segments in Vehicle Configuration

The electric sedan and Multi-Purpose Vehicle (MPV) segments complete the electric car market landscape in India, each catering to distinct consumer needs and preferences. The electric sedan segment appeals to luxury-conscious consumers seeking sophisticated design and premium features, while also serving the corporate and fleet markets. MPVs, on the other hand, target larger families and the commercial passenger transport sector, offering versatility and space efficiency. Both segments are witnessing continuous innovation in terms of battery technology, range capabilities, and charging solutions. Manufacturers are increasingly focusing on localizing production and developing market-specific features to enhance their appeal. These segments also benefit from the overall ecosystem development for electric vehicles, including improved charging infrastructure and supportive government policies.

Segment Analysis: Fuel Category

BEV Segment in India Electric Car Market

Battery Electric Vehicles (BEVs) dominate India's electric car market, commanding approximately 79% market share in 2024, driven by robust government support and increasing consumer acceptance. The segment's leadership position is reinforced by continuous technological advancements in battery technology and expanding charging infrastructure across major cities. Leading automotive manufacturers are expanding their BEV portfolios with new model launches across various price points, from affordable city cars to premium SUVs. The segment's growth is further supported by state-level incentives, reduced GST rates, and income tax benefits that make BEVs increasingly attractive to Indian consumers. Additionally, the improving range capabilities and decreasing battery costs are addressing key consumer concerns about adoption, while the expanding public and private charging network is enhancing the practical viability of BEVs for daily use.

FCEV Segment in India Electric Car Market

The Fuel Cell Electric Vehicle (FCEV) segment is emerging as the fastest-growing category in India's electric car market, with significant growth potential from 2024 to 2029. This remarkable growth trajectory is supported by increasing investments in hydrogen infrastructure and growing government support for hydrogen fuel cell technology. The segment is witnessing heightened interest from both domestic and international automakers who are planning to introduce FCEV models in the Indian market. The National Hydrogen Mission's implementation is creating a favorable environment for FCEV adoption, with planned investments in hydrogen production and distribution infrastructure. Additionally, several state governments are developing policies to promote hydrogen fuel cell technology, while research institutions are working on advancing FCEV technology to improve efficiency and reduce costs.

Remaining Segments in Fuel Category

The Hybrid Electric Vehicle (HEV) and Plug-in Hybrid Electric Vehicle (PHEV) segments represent important transitional technologies in India's journey toward complete vehicle electrification. HEVs continue to appeal to consumers seeking improved fuel efficiency without range anxiety, while PHEVs offer the flexibility of both electric and conventional driving modes. These segments are particularly attractive to luxury car manufacturers who are introducing premium hybrid models to the Indian market. The growing acceptance of hybrid technology among Indian consumers is supported by increasing awareness of environmental benefits and the lower total cost of ownership compared to conventional vehicles. Both segments are seeing expanded model offerings across various vehicle categories, from sedans to SUVs, providing consumers with diverse options in their transition to cleaner mobility solutions.

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For the Vehicle Hub report, we provide an extensive collection of over 150 free charts, delivering detailed insights on regional and country-level dynamics within the vehicle industry. This encompasses in-depth analyses of vehicle registrations, usage patterns in both consumer and business segments, and evaluations of various vehicle configurations and body types. The report delves into critical industrial trends such as shifts in vehicle production and distribution centers, changes in vehicle ownership costs, and advancements in automotive technologies. Further, our report offers comprehensive market segmentation by vehicle type, body type, propulsion, and fuel categories, providing a nuanced understanding of the market landscape. It also explores the adoption rate of new technologies, the impact of regulatory changes, and the influence of economic factors on the vehicle market. We include a thorough examination of key industry players, regulatory frameworks, and market size in terms of both revenue and unit sales, leading to strategic projections and forecasts that account for emerging trends and potential shifts in the industry.