Electric Vehicle

Advantage India

Robust
Demand

*The Indian EV market is forecasted to expand from US$ 3.21 billion in 2022 to US$ 113.99 billion by 2029, with a 66.52% CAGR.

*The Indian EV battery market is projected to surge from US$ 16.77 billion in 2023 to a remarkable US$ 27.70 billion by 2028.

*India is on track to become the largest EV market by 2030, with rise in investment over the next 8-10 years.

Opportunities

*A cost-effective manufacturing base keeps costs lower by 10-25% relative to operations in Europe and Latin America.

*The imperative highlighted by a recent Confederation of Indian Industry (CII) report to set up 1.32 million charging stations by 2030 presents a significant growth opportunity for the electric vehicle sector.

*Presence of a large pool of skilled & semi-skilled workforce amidst a strong educational system.

Policy
support

*A dedicated policy FAME II with a budgetary outlay of US$ 1.43 billion (Rs. 10,000 crore), to incentivize electric vehicle consumption and support manufacturing.

*100% FDI allowed under automatic route for the auto components sector.

*Electric Mobility Promotion Scheme with a US$ 60.18 million (Rs. 500 crore) budget to enhance green mobility and stimulate electric vehicle manufacturing in the country.

Investments

*India is emerging as a global hub for auto component sourcing and the industry exports over 25% of its production annually.

*Hyundai Motor intends to invest US$ 2.45 billion in Tamil Nadu over the next decade to enhance its electric vehicle initiatives in India. Also, the company is planning to assemble EV battery packs and install 100 charging stations for EVs

Snapshot Showcase Infographics Reports

Last updated: Jun, 2024

Electric Vehicle Industry Report

Mar, 2024

Introduction

India's electric vehicle (EV) sector is experiencing rapid growth, fuelled by government incentives, rising environmental concerns, and technological advancements. With initiatives like the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme, India aims to significantly increase EV adoption, revolutionizing its transportation landscape towards sustainability and innovation.

India has established an objective to elevate the proportion of electric vehicle (EV) sales to 30% in private cars, 70% in commercial vehicles, 40% in buses, and 80% in two-wheelers and three-wheelers by the year 2030. This equates to an ambitious objective of 80 million EVs on Indian roads by 2030. Additionally, India strives for complete domestic EV production through the 'Make in India' initiative.

In 2023, the global electric vehicle market was valued at US$ 255.54 billion. It is forecasted to reach approximately US$ 2,108.80 billion by 2033, growing at a significant CAGR of 23.42% from 2024 to 2033.

In 2023, electric vehicle sales in India saw a significant increase of 49.25%, reaching 1.52 million units. Although the sector is still in its early stages, it is steadily gaining traction. According to Fortune Business Insights, the Indian EV market is forecasted to expand from US$ 3.21 billion in 2022 to US$ 113.99 billion by 2029, with a 66.52% CAGR.

The shift towards electric vehicles on a global scale will create fresh opportunities for automotive suppliers. The Indian EV battery market is projected to surge from US$ 16.77 billion in 2023 to a remarkable US$ 27.70 billion by 2028.

On the infrastructure side, as of February 2024, there are 12,146 operational public EV charging stations nationwide, Maharashtra has the highest number of EV charging stations, followed by Delhi and other states. A recent Confederation of Indian Industry (CII) report emphasized the necessity of establishing at least 1.32 million charging stations in India by 2030 to facilitate the rapid growth of electric vehicles, requiring over 4,00,000 installations annually.

Major industry players are striving to improve electric vehicle charging infrastructure, Hyundai Motor India is enhancing accessibility to electric vehicles nationwide, expanding its ultra-fast EV charging network with 11 new stations strategically located in cities including Mumbai, Pune, Ahmedabad, Hyderabad, Gurugram, and Bangalore, as well as along major highways.

Maharashtra targets 10% share of EVs in all new vehicle registrations by Dec 2025.

Karnataka has set a goal to electrify 100% of three and four-wheeler cargo vehicles by December 2030.

Market Size

According to Fortune Business Insights, the Indian EV market is forecasted to expand from US$ 3.21 billion in 2022 to US$ 113.99 billion by 2029, with a 66.52% CAGR.

The Indian EV battery market is projected to surge from US$ 16.77 billion in 2023 to a remarkable US$ 27.70 billion by 2028.

According to NITI Aayog and Rocky Mountain Institute (RMI), India's EV finance industry is likely to reach Rs. 3.7 lakh crore (US$ 50 billion) in 2030.

Investment

In March 2024, Okaya EV, a prominent electric two-wheeler manufacturer, has launched "Ferrato," its premium electric vehicle brand, as part of its nationwide expansion strategy, they will prioritize high-end models.
In March 2024, Ola Electric, poised for an IPO, has emerged as India's top patent publisher for 2022-23, with 205 patents in EV and related technologies, surpassing rivals.
In March 2024, Ola Electric has announced to introduce a consumer-focused electric autorickshaw named Raahi.
In March 2024, BYD India, a subsidiary of the world's leading New Energy Vehicles (NEV) manufacturer, announced its entry into the luxury electric sedan segment with the launch of the BYD SEAL. BYD India currently has two products in its portfolio - the BYD ATTO 3 and the All-New e6, both of which have been very well received by Indian consumers.
In December 2023, Indian Oil Corporation (IOC) inaugurated its inaugural battery-swapping station in Kolkata for electric vehicles (EV). The oil marketing PSU collaborated with Sun Mobility, affirming its commitment to advancing sustainable electric mobility solutions.
In November 2023, SAIC Motor and JSW Group announced a strategic joint venture to accelerate growth with focus on green mobility.
In August 2023, Adani TotalEnergies E-Mobility Limited (ATEL) disclosed a collaboration with all-electric cab aggregator, Prakriti E-Mobility (Evera), to deploy EV charging infrastructure, starting with a 200-point super hub in Delhi.
Fuelled by robust demand and governmental backing, Gujarat's Electric Vehicle (EV) landscape is experiencing rapid expansion. In 2023, EV sales surged by 28% compared to the prior year, totalling 88,619 vehicles, showcasing remarkable growth from 2021's 10,885 units, reflecting a 714% increase over three years.
In August 2023, Mahindra & Mahindra anticipates that its forthcoming plant in Chakan, Maharashtra, will reach a peak production capacity of 200,000 electric vehicles annually from 2027 to 2029. They project EVs to constitute 30% of total volumes by 2030.
According to a UK-based breakdown and recovery service provider, electric vehicles (EVs) exhibit a 59% lower likelihood of breakdown compared to traditional internal combustion engine (ICE) vehicles. Start Rescue's Managing Director, Lee Puffett, emphasized the remarkable reliability of EVs, spanning from new to a decade old, on the road. With over a million EVs currently in operation in the UK, this data underscores the practical advantage of choosing an EV, reducing the risk of unexpected roadside issues.
In February 2024, the Indian Army has proposed a gradual introduction of a select number of Electric Vehicles (EVs) at 'Peace Stations' nationwide. This initiative aims to embrace technological advancements, promote green energy, and diminish reliance on fossil fuels.
In October 2023, Mr. R. K. Singh, Union Minister for Power and New & Renewable Energy, unveiled the new EV-Ready India Dashboard (evreadyindia.org) in New Delhi, facilitating access to pertinent information.
Ministry of Electronics & Information Technology (MeitY), Mr. S Krishnan attended the unveiling of a domestically developed 2KW DC Portable Charger at IIT Madras Research Park in October 2023. This initiative aims to accelerate electric vehicle adoption.
In January 2024, VinFast and Tamil Nadu Govt. signed a MoU to invest US$ 2 billion for an EV project in Thoothukudi, with US$ 500 million committed for the first phase, targeting 150,000 units annually.

Government Initiatives

The Government has reaffirmed its commitment towards EVs and its mission for 30% electric mobility by 2030. Budget announced customs duty exemption on the import of capital goods and machinery required for the manufacture of lithium-ion batteries that typically power EVs.

FAME II for EV Scheme was Commenced on 1st April 2019 with a total budgetary support of US$ 1.43 billion (Rs. 10,000 crore), 30% procurement of manufactured or processed products must be from SMEs. This phase primarily targets the electrification of public and shared transportation. It aims to provide demand incentives for 7,090 e-buses, 5 lakh e-3 Wheelers, 55,000 e-4 Wheeler Passenger Cars, and 10 lakh e-2 Wheelers. Additionally, the scheme supports the development of charging infrastructure. As of December 2023, electric vehicle manufacturers received a subsidy of US$ 637 million (Rs. 5294.00 crore) for selling 11,79,669 electric vehicles under Phase-II of the FAME India Scheme.

The government has outlined a scheme to transition 800,000 diesel buses to environmentally friendly alternatives, possibly supplanting FAME III. The strategy involves substituting 800,000 diesel buses, comprising over a third of all vehicles on roads, with electric ones within seven years.

This endeavour seeks to diminish vehicular emissions and stimulate investments in the national electric vehicle (EV) infrastructure.Electric Mobility Promotion scheme with a US$ 60.18 million (Rs. 500 crore) budget will be operational from April 1 to July 31, 2024, aiming for effective implementation within this period, to enhance green mobility and stimulate electric vehicle manufacturing in the country, further measures will be taken to promote this sector. It will be applicable on electric two-wheeler (e-2W) and three-wheeler (e-3W). The Scheme supports 3,72,215 EVs, comprising 3,33,387 e-2Ws, and 38,828 e-3Ws (including 13,590 rickshaws & e-carts and 25,238 e-3Ws in L5 category), offering incentives exclusively for advanced battery-equipped vehicles

References: International Organization of Motor Vehicle Manufacturers, Media Reports, Press Releases, Department for Promotion of Industry, and Internal Trade (DPIIT), Automotive Component Manufacturers Association of India (ACMA), Society of Indian Automobile Manufacturers (SIAM), Union Budget 2023-24, EY Parthenon Electrifying Indian Mobility.

Note: Conversion rate used in February 2024, Rs. 1 = US$ 0.012, * - Includes Electric vehicles and auto mobiles, E - Estimated