The India electric car market was valued at USD 10,107.18 million in FY2021 and is projected to grow at a CAGR of 41.02% during the forecast period, reaching a value of USD 78,190.10 million by FY2027. Continuous advancements in technology to upgrade existing infrastructure and new inventions in the automotive industry are fueling demand for electric cars. Government initiatives to improve electric charging infrastructure and the approval of a production-linked incentive (PLI) scheme for manufacturing advanced chemistry cell (ACC) batteries with an estimated budget of Rs. 18,100 crore are expected to accelerate market growth. The National Programme on Advanced Chemistry Cell, aimed at promoting the Make in India initiative, is expected to attract high foreign and domestic investments.
The increase in the number of manufacturing hubs for electric cars and rising environmental concerns are driving demand for electric cars. The burden of oil imports and rising prices of conventional energy sources are changing consumer preferences towards green energy fuels. High demand for automobiles due to a rising population and depleting energy sources are creating lucrative opportunities for electric car market growth. The production of batteries by domestic manufacturers and the import of batteries from global manufacturers are expected to drive positive growth in the electric car market.
The Paris Agreement, which aims to curb carbon emissions, improve air quality in cities, and decrease oil imports, is the foundation for India’s EV strategy. With a growing population and demand for vehicles, conventional energy resources are not viable as India imports most of its crude oil. Thus, the government is focusing on increasing the number of EVs, including cars, in line with its goal to achieve net-zero carbon emissions by 2070.
Browse Full Report (India Electric Car Market By Vehicle (SUV & MPV, Sedan, Hatchback), By Drivetrain (FWD, RWD, AWD), By Battery Capacity (Below 25 KWH, 25KWH-40KWH, Above 40KWH), By Company, By Region, Forecast & Opportunities, FY2027)- https://www.techsciresearch.com/report/india-electric-car-market/7981.html
In November 2021, at the Conference of Parties COP26 Summit in Glasgow, India launched the e-AMRIT website as a one-stop resource for information on electric cars. It covers important topics related to EVs and their purchase, including charging station locations and EV financing options, as well as providing details on investment opportunities, regulations, and manufacturers.
In addition to well-known advantages such as lower carbon dioxide emissions and reduced air and noise pollution, EVs also offer significant efficiency gains and have the potential to become a storage source for renewable energy. Vehicle owners and first-time buyers are looking for less expensive solutions, and electric cars fit the bill, especially when considering their long-term maintenance costs.
OEMs are dedicatedly training their sales and aftersales teams on EVs. Meanwhile, the entire ecosystem of manufacturers, central and state governments, dealers, and investors is focused on ensuring that everyone in the supply chain has significant knowledge about handling and maintaining these vehicles. Owning an electric car requires a behavioral change with respect to vehicle and battery maintenance. Thus, manufacturers are also focusing on educating consumers about the usage and maintenance of their battery models.
The sport utility vehicles (SUVs) category is expected to record the highest CAGR of around 35% during the forecast period due to rising disposable income among citizens and increasing demand for premium cars across the country. As a result, several manufacturers are focusing on launching SUVs to expand their sales and customer base. For instance, in July 2022, Mahindra & Mahindra Ltd. and British International Investment agreed to invest up to $250 million each in a new EV manufacturing facility valued at $9.1 billion (INR 70,070 crore) to expand sales of their electric SUVs.
Additionally, many international companies are introducing new vehicles in India to diversify their geographical presence and improve their business performance. For example, in October 2022, BYD India Private Limited launched the Atto 3 electric SUV, designed to compete with Tesla by offering better driving comfort. Similarly, in July 2022, Sweden’s AB Volvo debuted its electric compact SUV XC40 Recharge in the country.
Government schemes and subsidies are playing a major role in the production and sales growth of EVs. In April 2015, the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME) scheme was launched in India to promote the adoption of hybrid and EVs. In April 2019, the FAME-II scheme was launched with a budget outlay of $1.3 billion (INR 10,000 crore) to support 55,000 e-passenger vehicles and charging stations.
The government extended the scheme until 2024 as announced in the Union Budget 2022-23. With a focus on providing affordable and environmentally friendly public transportation to the masses, the scheme mainly applies to vehicles registered for commercial purposes or used for public transport. Due to additional incentives at the state level, Karnataka tops the chart in terms of beneficiaries under the scheme, followed by Tamil Nadu, Maharashtra, Rajasthan, and Delhi.
Furthermore, in May 2021, the government launched the Production-Linked Incentive (PLI) Scheme for Advanced Chemistry Cell (ACC) Battery Storage Manufacturing to incentivize domestic battery production and reduce dependence on imports. This will further support the EV industry with vital infrastructure and significantly reduce the cost of electric cars.
In 2022, Uttar Pradesh led the market due to its large customer base and numerous suppliers across the EV value chain. In October 2022, the state cabinet approved the new EV policy, called Uttar Pradesh Electric Vehicle Manufacturing and Mobility Policy 2022, to benefit both personal and commercial vehicles. The government will provide a complete waiver of registration fees and road tax for vehicles bought and registered in the state.
Maharashtra is expected to witness significant growth during the forecast period. In July 2021, with the goal of increasing EV adoption, the state government rolled out a comprehensive policy that capped the maximum incentive at $2,029.1 and made buyers eligible for early-bird incentives.
In Mumbai, over a hundred housing societies have deployed EV charging stations with a subsidized price of $0.07 per unit, significantly lower than standard residential power prices. Additionally, 1,500 more EV charging stations are planned for the city, and the government aims to ensure that 10% of new automobile registrations are EVs by 2025.
Pune (especially Pimpri-Chinchwad), Mumbai, and Nagpur have recorded the highest EV sales in the state in recent months. Among the new registrations are cars, particularly SUVs with a range of 300 km on a single charge, which is adequate for both intra-city and intercity travel.
The India electric car market can be segmented based on vehicle type, drivetrain, battery capacity, regional distribution, and company. In terms of vehicle type, the market can be further segmented into hatchbacks, sedans, and SUVs & MPVs. The hatchback segment is expected to witness the fastest growth due to increasing consumer affordability. The presence of battery manufacturing companies is also reducing battery costs for electric cars, lowering their purchase price.
Due to its large population, better employment opportunities, and high standard of living, demand for electric cars is extremely high in the southern region of India and is a major contributor to overall demand in the country. With rising infrastructural developments and employment opportunities in the region, demand for electric cars is expected to continue growing. The southern region accounted for over 36% volume share in FY2017, followed by the northern region.
Major players operating in the India electric car market include Tata Motors Limited, MG Motors India, Hyundai Motor Company, Mahindra Electric Mobility Limited, Toyota Kirloskar Motor (Toyota), Honda Cars India Limited (Honda Cars), Renault India Private Limited, Tesla Inc., and others. These companies are developing advanced technologies and launching new services to stay competitive in the market. Other competitive strategies include mergers and acquisitions and new service developments.
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Years considered for this report:
Historical Years: FY2017-FY2020
Base Year: FY2021
Estimated Year: FY2022
Forecast Period: FY2023-FY2027
Objective of the Study:
- To analyze the historical growth in the market size of India electric car market from FY2017 to FY2020.
- To estimate and forecast the market size of India electric car market from FY2021 to FY2027 and growth rate until FY2027.
- To classify and forecast India electric car market based on vehicle type, drivetrain, battery capacity, regional distribution, and company.
- To identify the dominant region or segment in the India electric car market.
- To identify drivers and challenges for India electric car market.
- To examine competitive developments such as expansions, new product launches, mergers & acquisitions, etc., in India electric car market.
- To identify and analyze the profile of leading players operating in India electric car market.
- To identify key sustainable strategies adopted by market players in India electric car market.
TechSci Research performed both primary as well as exhaustive secondary research for this study. Initially, TechSci Research sourced a list of manufacturers across India. Subsequently, TechSci Research conducted primary research surveys with the identified companies. While interviewing, the respondents were also enquired about their competitors. Through this technique, TechSci Research was able to include the manufacturers who could not be identified due to the limitations of secondary research. TechSci Research analyzed the manufacturers, distribution channels and presence of all major players across the globe.
TechSci Research calculated the market size of India electric car market using a bottom-up approach, wherein data for various end-user segments was recorded and forecast for the future years. TechSci Research sourced these values from the industry experts and company representatives and externally validated through analyzing historical data of these product types and applications for getting an appropriate, overall market size. Various secondary sources such as company websites, news articles, press releases, company annual reports, investor presentations and financial reports were also studied by TechSci Research.
Key Target Audience:
- Electric car manufacturing companies
- Market research and consulting firms
- Government bodies such as regulating authorities and policy makers
- Organizations, forums and alliances related to electric car market
The study is useful in providing answers to several critical questions that are important for the industry stakeholders such as manufacturers, suppliers and partners, end users, etc., besides allowing them in strategizing investments and capitalizing on market opportunities.
Report Scope:
In this report, India electric car market has been segmented into following categories, in addition to the industry trends which have also been detailed below:
- India Electric Car Market, By Vehicle Type:
- SUV & MPV
- Sedan
- Hatchback
- India Electric Car Market, By Drivetrain:
- Front Wheel Drive (FWD)
- Rear Wheel Drive (RWD)
- All-Wheel Drive (AWD)
- India Electric Car Market, By Battery Capacity:
- Below 25 KWH
- 25KWH-40KWH
- Above 40KWH
- India Electric Car Market, By Region:
- North
- South
- East
- West
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About TechSci Research:
TechSci Research is a research-based management consulting firm providing market research and advisory solutions to its customers worldwide, spanning a range of industries. TechSci Research’s core values are value, integrity and insight. Led by a team of dynamic industry experts, TechSci Research provides its customers with high value market research and advisory services that helps them identify new market opportunities, growth engines and innovative ways to capture the market share. As a result, TechSci’s client leads rather than follow market trends. Not bound by legacy, TechSci’s cutting-edge research model leverages its decades of research knowledge and increased use of technology as engines of innovation to deliver unique research value. Provided as an alternative to traditional market research, TechSci Research reports do not just deliver data and knowledge rather highlights the insights in a more usable and interactive format for its clients.
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