E-Cars Market in India, October 2021

Executive Summary

The adoption of Electric cars (E-Cars) globally has witnessed a surge, with sales in the first half of 2021 already surpassing the 2020 numbers. Similar trends can be observed in India too. However, this growth is not at the same scale as in other countries. For instance, while the share of Battery Electric vehicles (BEVs) in the total number of passenger vehicles sold in Europe was 5.4%, the same in India was a minuscule 0.2% in FY2020. However, as per JMK Research’s projections, E-Cars are expected to account for nearly 12% of all passenger cars by FY2026.

While positive steps have been taken by the Central government to promote and accelerate the growth of an EV ecosystem in India, recent restructuring in FAME-II policies suggest that the government has shifted its focus on electric 2 wheelers (E2Ws) to generate demand for achieving short-term growth. However, from a long-term perspective, E-Cars are expected to play a pivotal role, especially in the aftermath of the COVID-19 pandemic with a surge in the need for personal mobility.

Switching to E-Cars from the traditional fuel-driven cars has many advantages even in the present scenario. The Total Cost of Ownership (TCO) analysis done by JMK Research for this report shows that while E-Cars may demand a higher upfront cost versus its ICE counterparts, the TCO over a 5-year and 10-year period will be 35-56% lower for E-Cars, depending on the driving scenario. Nevertheless, there are some notable barriers when it comes to choosing E-Cars over ICE cars, the major one being the lack of options in the market presently.

Over the last four years, the E-Car sales have been driven by two players, namely Tata Motors and Mahindra, which together account for 80% of the total market. These players have single models each, which are available for prices between INR 8 lakh and INR 14 lakhs. However, the absence of options in the affordable segment (Price < Rs. 8 lakhs) could translate to slower adoption of E-Cars. Other notable barriers to E-Car adoption are range concerns, lack of charging infrastructure, absence of financing mechanisms, and safety concerns among end-users regarding the batteries. 

This report maps out the present status of the E-Car market in India, studies the key players present in the market, highlights the challenges and barriers to its adoption, analyses the central and state-level policies in place to understand its effects and gives an outlook to where the E-Car market is headed towards in the future.

Table of Contents

1. Global E-Cars Sales Trend

2. India Market Overview

    2.A Policies

    2.B Key Players

    2.C State-Wise Sales Trends

3. Drivers for E-Car Adoption

4. Challenges

5. Annexure

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