From ICE to EV: Traditional Players Navigating Change
The rapid shift towards Electric Mobility has compelled the traditional Indian automotive industry to shift gears and embrace EVs. From personal vehicles, including two-wheelers and cars, to public transportation options, such as three-wheelers and buses, although the pace of EV adoption has varied across the segments, there is a clear trend towards greener, more sustainable transportation solutions.
This transition presents a unique landscape where traditional Internal Combustion Engine (ICE) vehicles continue to dominate while EVs are rapidly gaining ground.
Two Wheelers
Fig1: Two-Wheelers: Steady Progress by Leading Players:
Source: Vahan Dashboard, Telangana Open Source, JMK Research
*Note: Sales data for 2024 is considered up to Aug-24.
The two-wheeler has been the most dynamic segment, with a penetration of 5.12% in 2023.
Hero MotoCorp has been the leader in the ICE two-wheeler segment. The firm entered the EV market in October 2022 with the VIDA V1 electric scooter and has since achieved impressive EV sales in a relatively short period. In 2024, Hero MotoCorp EV sales accounted for 0.74% of Hero’s total ICE+EV sales.
On the other hand, TVS and Bajaj have made significant inroads in the EV market. While the EV penetration of TVS rose from 6.38% in 2023 to 7.26% in the 2024 YTD period, Bajaj stood out with the highest growth in EV adoption, jumping from 4.04% in 2023 to an impressive 8.32% in the 2024YTD period.
Three Wheelers
Fig 2: Three-Wheelers: Strong EV Adoption in Passenger Segment
Source: Vahan Dashboard, Telangana Open Source, JMK Research
*Note: Sales data for 2024 is considered up to Aug-24.
The three-wheeler segment has seen impressive progress in EV adoption. The passenger E3W category, in particular, has grown tremendously, with EV penetration of about 54.85% in 2023. Bajaj Auto emerged as a frontrunner, with 7.70% of its total sales coming from EVs in the 2024YTD period, up from 1.21% in 2023. Piaggio followed closely, with 28.61% in the 2024YTD period, compared to 27.77% in 2023. Mahindra stood out with an impressive 96.75% of its sales attributed to EVs in the 2024YTD period.
Fig 3: Three-Wheelers: Strong EV Adoption in Cargo Segment
Source: Vahan Dashboard, Telangana Open Source, JMK Research
*Note: Sales data for 2024 is considered up to Aug-24.
In the 3W Cargo category, EV penetration climbed to 49.44% in 2024YTD period from 41.55% in 2023. Among India’s top three-wheeler goods auto OEMs, Bajaj Auto led with 32,516 units sold, 5.96% of which were electric. 12.43% of the 19,166 units sold by Piaggio were electric in 2024YTD period. Mahindra Last Mile Mobility made notable shift towards EVs, with an impressive 77.08% of its 9,527 units sold being electric in 2024YTD period, compared to 69.29% in 2023.
Four Wheelers
Fig 4: E-Cars: Penetration by Manufacturer
Source: Vahan Dashboard, Telangana Open Source, JMK Research
*Note: Sales data for 2024 is considered up to Aug-24.
The EV penetration in the passenger car segment rose slightly from 2.27% in 2023 to 2.39% in 2024YTD sales. However, the contribution of electric cars varies significantly among key players.
Tata leads the EV revolution in the Indian car market, maintaining an EV penetration of 12.05% in 2024YTD sales, slightly down from 12.61% in 2023. The Nexon EV, Punch EV and Tigor EV have solidified Tata’s position as the market leader in electric cars.
Despite being a global player in electric cars, Hyundai’s EV penetration in India remains low at 0.22% in the 2024YTD period. Kia’s EV penetration also grew to 1.28% in 2024YTD period, but competition remains fierce.
MG Motors, however, has emerged as a standout player, achieving an impressive EV penetration of 33.77% in 2024YTD period compared to 23.75% in 2023. MG’s aggressive push into electric cars can be attributed to a competitive price point and robust feature offerings, which have positioned it well against other OEMs.
The Indian automotive industry is at a critical juncture, with electric mobility gaining momentum across multiple segments. While traditional ICE vehicles still dominate the market, EVs are rapidly catching up, particularly in the two-wheeler and three-wheeler segments. Lower running costs, government subsidies, reduced maintenance expenses, and a competitive TCO make EVs a compelling option for consumers. The leaders in the automotive segment, such as Tata Motors, Bajaj, Hero MotoCorp, TVS, etc., have made EVs more accessible while offering robust after-sales support. With the ongoing launch of new EV models and the increased efforts in electrification by manufacturers, the Indian automotive industry is set to rapidly shift towards EVs in the near future.