The market share of electric vehicles (EVs) in India is expected to grow significantly to 30-35 per cent by FY 2030 from just 7.4 per cent in 2024 and just 1 per cent in 2019, according to a recent report by SBI Capital Markets. Two-wheelers and three-wheelers are leading the EV segment in the country.
According to data cited in the report, fossil fuel vehicle sales are still high, but EV sales are steadily increasing. The low vehicle numbers mean that India has a unique opportunity to adopt EVs, making them the first vehicle for many consumers. This is similar to how India skipped 3G and adopted 4G directly.
The key components of an EV, the battery and electronic drive unit, account for about 50 per cent of the total cost of these vehicles. Government support, such as the PLI scheme for Advanced Chemistry Cells (ACC), is likely to reduce costs.
There are also plans for long-term investments to grow the EV industry. It is estimated that by 2030, capital expenditure of Rs 500-600 billion will be required for EV battery capacity and Rs 200 billion for strengthening charging infrastructure.
Additionally, incentives like PM E-Drive offered by the Government of India to promote specific vehicle segments and support the development of EV charging infrastructure are vital to the growth of the sector.
