Surge in Electric Two-Wheelers in India
The adoption of electric two-wheelers is rapidly gaining traction in India, with projections indicating a noteworthy increase in market share. As per a report by investment banking firm Jefferies, the share of electric two-wheelers is expected to escalate from the current 5% to an impressive 13% by the financial year 2026-27. This marks a significant change in the landscape of Indiaโs transportation sector, reflecting growing consumer interest and commitment to sustainable mobility solutions.
Current Market Dynamics
In the financial year ending March 2024, electric two-wheelers accounted for merely 5% of the total two-wheeler sales. However, this figure has shown a modest increase over the years, particularly between the financial years 2020-21 and 2023. It is important to note that the past 12 months have seen fluctuations in the share, remaining between 4% and 7%. This inconsistency has been attributed to a reduction in government incentives, which play a pivotal role in influencing buyer decisions.
Manufacturers Respond to Market Needs
In response to changing market conditions, several electric two-wheeler manufacturers have launched affordable bikes and scooters. This strategic move aims to attract a broader customer base and stimulate sales. Jefferies anticipates that with consistent efforts, the market share of electric two-wheelers could grow steadily, projecting an increase to 7% in FY 2025, 10% in FY 2026, and reaching 13% in FY 2027. Nonetheless, potential risks are on the horizon; the introduction of a new scheme targeting only 2.5 million electric two-wheelers over the next two years may impact these forecasts, leading to a cautious outlook.
Market Leaders and Competitors
Ola Electric has emerged as a formidable player in the Indian electric two-wheeler market. The company commanded a significant market share, soaring from 21% in 2022-23 to 35% in 2023-24, and further climbing to an astonishing 49% in the first quarter of 2024-25. However, recent statistics reveal a decline in market share to 31% as of August 2024, which indicates a highly competitive market landscape. In contrast, competitors such as Bajaj, TVS, and Ather have witnessed a rise in their respective market shares during the same period, demonstrating the dynamic nature of the electric two-wheeler segment.
Market Share Overview
| Year | Ola Electric Market Share | Overall Electric Two-Wheeler Market Share |
|---|---|---|
| 2022-23 | 21% | 5% |
| 2023-24 | 35% | – |
| Q1 2024-25 | 49% | – |
| August 2024 | 31% | – |
Conclusion
The electric two-wheeler market in India is at a critical juncture, characterized by rapid growth potential tempered by challenges. As manufacturers innovate and consumer awareness increases, the landscape is likely to evolve significantly in the coming years. The role of incentives, market adaptability, and competition will greatly define the trajectory of electric two-wheelers in the Indian automotive industry.
