EV sales to zoom by 66% in 2024 on back of subsidies, better infrastructure: Report

Electric Vehicle (EV) sales in India are set to surge by 66 percent this year on the back of state subsidies and the development of supporting infrastructure, a report by Counterpoint Research stated. With the projected growth, EVs will constitute around 4 per cent of the total PV market by 2024-end.

The report forecasts that by 2030, EVs are expected to represent nearly a third of India's personal vehicle market.

The Indian EV sector ended FY2024 on a strong platform, setting record sales across vehicle types. Sales rose by 41% annually, reaching 1.66 million EVs sold. The month of March saw a new record with over 197,000 units sold, partly driven by the rush to benefit from the ending FAME-II subsidy scheme.

To replace FAME II, the government has floated the Electric Mobility Promotion Scheme 2024, allocating Rs 500 crore to encourage the adoption of electric two and three-wheelers. The scheme is valide from April to until the end of July this year.

Data from Vahan website stated that from April 2023 to March 2024, India saw the purchase of 1,665,270 EVs, averaging 4,562 EVs sold each day, a significant jump from the 3,242 daily sales the previous year. This increase reflects the growing interest in EVs, despite high prices for petrol, diesel, and CNG.

Speaking on the EV market, Research Vice President Neil Shah said: “We will see players in the broader value chain prioritizing India’s market not only to target domestic consumption but also for technology R&D and export opportunities. This would span from the likes of Qualcomm and MediaTek designing and offering advanced auto components to BlackBerry providing safety and security software, to Foxconn reducing barriers for new entrants to India with its innovative MIH consortium-based ‘localized’ design and manufacturing model.”

The top players in the Indian EV market are Tata Motors, which held more than two-thirds of the market share in 2023. Followed by Mahindra & Mahindra (M&M) and BYD.

Mahindra & Mahindra recorded EV sales growth of nearly 2,500 percent last year with its impressive all-electric SUV XUV400. BYD grew over 1500 percent in 2023 with its two offerings -- e6 MPV and Atto 3 SUV.

Besides cars, two-wheelers accounted for 56 per cent of all EV sales with 29 per cent year-on-year growth, while three-wheelers saw a 57 per cent growth and made up 38 per cent of sales. Together, these vehicles represented 94 per cent of all EV sales in the country.

India has set an ambitious target to slash its carbon emissions by 45 per cent by the year 2030, with electric vehicles (EVs) playing a pivotal role in realizing this goal. The adoption of EVs is being stimulated by favourable governmental policies which encompass tax reductions, subsidies, and diminished Goods and Services Tax rates. 

Experts predict that by the year 2030, EVs will constitute a considerable segment of the automotive market, with the potential to generate up to $100 billion in revenue. This anticipated demand surge is likely attributable to factors such as economical battery options, governmental motivators, increasing consumer cognizance concerning environmental sustainability along with a more diverse range of EV models becoming available on the market.