EV MANUFACTURING 2030, SCALING FOR GLOBAL DEMAND

India seeks to attain a 30% share of electric vehicles in the total vehicles sold by 2030. Sales of EVs in India went up from 50,000 in 2016 to 2.08 million in 2024, as against global EV sales having risen from 918,000 in 2016 to 18.78 million in 2024. Thus, India's transition has been slow to start, but it is picking up. India's EV penetration was only about one-fifth of the global level in 2020, but it is expected to increase to two-fifths of the global penetration by 2024. It continues to show an increasing trend, though relatively slow, as published by NITI Aayog. OEM Update, along with industry experts, examines whether India's 2030 target is achievable and assesses the current scenario on this journey.

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The contemplation towards the mobility sector has increased in the past few years with the advent of EVs, hybrid technology and many more underway.

Governments, OEMs, and suppliers are eyeing a shift from internal combustion engines to clean, sustainable alternatives.

The government's vision is to achieve 30% of all vehicle sales being electric by the year 2030. The race to 2030 has also intensified due to global OEMs working to achieve cost parity with ICE vehicles while scaling up manufacturing capacity to meet unprecedented demand. At the same time, supply chain disruptions, raw material constraints, and the need for localised gigafactories are pushing manufacturers to rethink strategies.

Achieving the ambitious target of 30% EV penetration by 2030 requires a historic adoption rate, given that it took approximately a decade to reach the current ~7.6% sales share. The formula to bridge this gap hinges on inherent domestic development while mitigating external supply chain vulnerabilities.

Accelerating factors

Captive domestic market: India's domestic market is a guaranteed base for demand. This scale makes investment viable and stimulates the entire ecosystem. Competitive ecosystem and product innovation: India has a vivid environment where established automotive giants (like Tata, Mahindra) are competing directly and collaborating with agile EV startups (like Ola, Ather). This pressure demands product development, leading to products specifically suited for Indian conditions (e.g., lower cost, better thermal management, higher ground clearance).

Investor confidence: The sustained flow of investment into EV startups and established players is a powerful indicator of expected high growth rates. Investor capital helps this scale up.