EVs to hit 30-35% of India’s annual vehicle sales by FY30
A report predicts with low vehicle ownership and unique growth drivers, India has a chance to leapfrog, making EVs the first car for many, just as it skipped 3G for 4G. By FY30, EVs could hit 30-35 per cent of annual sales
New Delhi: The electric vehicle (EV) revolution is in full throttle and EVs could hit 30-35 per cent of annual vehicle sales in India by FY30, though internal combustion engine (ICE) vehicles will still dominate the roads, co-existing with EVs for years to come, according to a new report.
India is catching the EV wave, with penetration rising from less than 1 per cent in 2019 to 7.4 per cent in 2024. “With low vehicle ownership and unique growth drivers, India has a chance to leapfrog, making EVs the first car for many, just as it skipped 3G for 4G. By FY30, EVs could hit 30-35 per cent of annual sales,” predicted the report by SBI Capital Markets (SBICAPS).
Batteries and electronic drive units, making up 50 per cent of an EV’s cost, are key differentiators from ICEs. India’s PLI for Advanced Chemistry Cell (ACC) aims to address this.
Currently, OEMs outsource 75 per cent of their battery needs, but backward integration is set to push this to 50 per cent by FY30, driven by alliances and JVs rather than purely organic efforts, the report predicted. Approximately Rs. 500-600 billion in capex is expected to achieve 100 GWh of EV battery capacity by 2030, while another Rs 200 billion will be required to expand public charging infrastructure to 90,000 chargers by FY30.
India’s EV boom rides on a web of incentives, 5 per cent GST compared to 28 per cent for most ICEs, lower road taxes in many States, FAME and PM E-DRIVE subsidies, and cheaper operating cost when using electricity compared to petroleum products thanks to a favourable tax structure.
India’s EV incentive game is smartly targeted — PM E-DRIVE boosts specific vehicle classes and expands support for charging infrastructure. The Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI) zeroes in on cars, where penetration lags. Plus, with global tech breakthroughs already paving the way, India can readily adopt mature solutions without reinventing the wheel,” the report elaborated.
EV adoption varies widely by category, with 2W and 3W leading the pack. According to the report, private cars are a unique EV segment, where performance, design, comfort, and safety often outweigh cost.
