The electric vehicle (EV) market in India is experiencing robust growth, with EVs now comprising 8.5% of all new car sales. According to data from the Federation of Automobile Dealers Associations (FADA), EV registrations surged by an impressive 95% year-on-year in September, totaling 36,108 units.
Tata Motors Dominates EV Sales in India
Tata Motors Passenger Vehicles (TMPV) continues to lead the electric car segment by volume. The automaker recorded 14,791 EV registrations in September, significantly bolstered by the popularity of its compact electric SUV, the Punch EV.
Other key players in the rapidly expanding Indian EV market include:
- Mahindra & Mahindra (M&M): Registered 7,780 electric SUV units, securing its position as the country's second-largest EV carmaker by volume.
- JSW MG Motor India: The joint venture between China’s SIAC Motor and JSW Group reported 5,242 EV registrations.
- VinFast: The Vietnamese carmaker secured fourth place with 2,964 EV registrations, largely driven by supplies to its ride-hailing affiliate, Green SM.
- Kia: Sold 1,262 EVs, entering the top five thanks to the recent launch of its Syros EV model.
- Maruti Suzuki: India’s largest internal combustion engine (ICE) carmaker, recorded 1,104 EV registrations.
- Tesla: After struggling to gain traction, the Elon Musk-led company showed signs of revival with 291 EV registrations.
Broader EV Penetration and Market Concerns
While passenger vehicle EVs are making significant strides, electric two-wheelers saw their penetration rise to 11.58% in September. Three-wheelers stood out with a remarkable 65% EV penetration, contributing to an overall EV penetration of approximately 13% across all vehicle categories.
Despite the growth in EVs, petrol remains the dominant powertrain in passenger vehicles, holding a 41% share. Compressed natural gas (CNG) vehicles accounted for 23% of total passenger vehicle sales in September, an increase from 22% in the same month last year, though slightly down from 25% in August 2026.
FADA Warns of Affordability Challenges
FADA has issued a warning that a series of price hikes by automakers in 2026 could jeopardize the affordability gains achieved through GST 2.0. FADA President Sai Giridhar stated, "Dealers now flag further price increases eroding that very affordability as their foremost risk for the quarter ahead. Protecting the GST gain is, to our mind, the key to converting the festive season into durable growth."
In September, passenger vehicle retail sales reached a record 4,27,213 units, marking a 32.10% increase year-on-year. Two-wheeler sales climbed 33.08% to 1.79 million units, and commercial vehicle retail sales grew 37.62%, surpassing the one-lakh mark for any September for the first time. This surge was partly attributed to a low-base effect from buyers deferring purchases ahead of the GST rate rationalization in September 2025.
However, passenger vehicle inventory levels are a growing concern, rising by five days from the end of August to approximately 43–45 days. This is significantly above FADA’s recommended 21-day benchmark, with 60% of passenger vehicle dealers reporting higher stock ahead of the festive season.