Electric two-wheelers to capture 13% market in India by 2026-27
What's the story
The adoption of electric two-wheelers (E2Ws) in India is steadily increasing, with a projected market share of over 13% by the fiscal year (FY) 2026-27, according to investment banking firm Jefferies.
The share of EVs in two-wheeler sales increased from 0.4% in 2020-21 to 5.4% by early 2023.
Furthermore, the E2W sector's share was at 5% in the FY ending March 2024.
This significant growth is attributed to increased subsidies and new product launches.
Sales forecast
Sales projected to reach 3.4 million units by FY27
Jefferies forecasts a steady rise in E2W sales from 0.9 million units in FY24, to an estimated 1.4 million, 2.3 million, and 3.4 million units in FY25, FY26, and FY27 respectively.
However, the firm also warns of potential risks to these projections due to the new scheme targeting just 2.5 million E2Ws over two years.
This cautionary note underscores the challenges faced in predicting future market trends for electric vehicles (EVs).
Market dynamics
Ola Electric dominates but sees recent market share dip
Ola Electric, a leading manufacturer in India's E2W market, has seen its market share rise from 21% in FY23 to 35% in FY24 and further to 49% in Q1 of FY25.
However, Jefferies reports that Ola's market share has subsequently fallen to 31% in August and just 29% in September (month-to-date).
Meanwhile, competitors like Bajaj Auto, TVS Motor Company and Ather Energy have each gained between 5-9% points since the June quarter.
Government initiative
Union Cabinet approves ₹10,900 crore scheme for electric mobility
The Union Cabinet has approved a ₹10,900 crore scheme to promote electric mobility in the country.
The 'PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) Scheme' proposed by the Ministry of Heavy Industries (MHI), includes subsidies worth ₹3,679 crore for various EVs including e-2Ws, e-3Ws, e-ambulances, e-trucks, and more.
The scheme aims to support nearly 2.5 million e-two-wheelers, over 300,000 e-three-wheelers, and more than 14,000 e-buses over two years.