Electric vehicle penetration in India currently only around 1%: Moody's report
Electric mobility has been one of the main focus points of the government in order to cut the import bills from petrol and reduce carbon emissions. However, electric vehicle (EV) penetration is still in its development stage in the country. A recently released report by Moody's Investors Service revealed that though India has the third-largest car market globally, EV penetration is currently only around 1%.
In 2022, India beat Japan to become the third-largest vehicle market after China and the USA.
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The report stated that certain factors will play a key role in accelerating the adoption of EVs. These factors are government incentives, including those to consumers, local battery manufacturing, state-level subsidies and cut in GST rates. The pace of increase in EV sales to meet the target set by government - 30% by 2030 - will also depend on the country's charging infrastructure, time taken to charge vehicles as well as consumers' readiness to switch to EVs.
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The government aims to have EV sales accounting for 30% of private cars, 70% for commercial vehicles and 80% for two-and three-wheelers by 2030.
The Moody's report stated that Tata Motors has retained an early mover advantage in the EV market in India, grabbing 85% market share between April and December 2022. The company has already sold 50,000 EVs thanks to its 250 dealers across 165 cities, and close to 4,300 charging points.
The company has already announced its plans to expand its EV line-up from four models to 10, by March 2026. Its EV business has already raised $1 billion from private-equity investor TPG.
Giving a geographical breakup of global electric vehicle sales last year, the report stated that sales of battery-powered vehicles were around 8 million, with 65% of these in China while 20% in Europe. Consumers in those regions benefited from the government incentives and automakers' expanded product offerings, the report stated.