Electric Car Sales Likely To Reach 1.3-1.5 Lakh In India By FY25: Report

This trend is driven by the government's initiatives to foster a sustainable, eco-friendly, and efficient transportation sector, as per the report

According to the report, the passenger vehicles (PV) sector is anticipated to achieve modest volume growth of approximately 3-5 per cent in FY25

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Electric car sales in India are expected to reach between 130,000 and 150,000 units in the current fiscal year (FY25), reflecting an increasing adoption rate, according to a report from CareEdge Ratings released on Tuesday. Following a 90 per cent growth to 90,432 units in FY24, the penetration of electric cars continues to rise steadily in India. 

This trend is driven by the government's initiatives to foster a sustainable, eco-friendly, and efficient transportation sector, as per the report. The transition to electric mobility encompasses not only cars and trucks but also sees increasing popularity in e-rickshaws and e-karts nationwide. 

According to the report, the passenger vehicles (PV) sector is anticipated to achieve modest volume growth of approximately 3-5 per cent in FY25. This projection considers factors such as the high base effect from FY24, a reduced order book, and expectations of continued subdued demand for entry-level variants in the upcoming fiscal year.

Arti Roy, Associate Director at CareEdge Ratings, said, “Strong demand for new model launches and SUVs coupled with the expectation of interest rate cuts in the second half of FY25 is expected to keep the sales momentum rolling.”

Over the last decade, the utility vehicle (UV) segment has consistently shown superior growth compared to the PV industry at large. In the fiscal year FY24, UV sales volumes surpassed those of passenger cars and vans for the first time. Presently, UVs constitute more than 55 per cent of total new PV sales, and their proportion within the overall PV market is projected to continue increasing over the medium term, as indicated in the report.

“While the market for premium vehicles is predicted to thrive, driven by a surge in demand for luxury and high-end models, entry-level variants are likely to see continued diminished demand due to a downturn in both rural and urban markets,” highlighted Hardik Shah, Director at CareEdge Ratings.