The Indian vehicle industry has traditionally been a fantastic indicator of how properly the economy is doing, as the auto quarter performs a key position in each macroeconomic growth and technological development. The 2-wheelers phase dominates the marketplace in phrases of volume, on account of a growing center magnificence and a huge percent of India’s population being young. Furthermore, the developing hobby of agencies in exploring the agricultural markets in addition aided the increase of the world.
The growing logistics and passenger transportation industries are riding up call for for commercial automobiles. Future marketplace growth is anticipated to be fuelled via new trends which includes the electrification of automobiles, specifically three-wheelers and small passenger automobiles.
India enjoys a sturdy position within the worldwide heavy cars market as it is the biggest tractor producer, 2d-biggest bus producer, and third-largest heavy truck manufacturer within the global. India’s annual manufacturing of cars in FY23 was 25.9 million motors. India has a robust marketplace in terms of domestic call for and exports. In December 2024, the whole manufacturing of passenger vehicles*, three-wheelers, 2-wheelers, and quadricycles was once 19,21,268 units.
Exports And Contribution
In FY23, general automobile exports from India stood at 47,sixty one,487. This sector’s proportion of the national GDP multiplied from 2.77% in 1992-1993 to round 7.1% at present. It employs about 19 million people without delay and not directly.
India is also a prominent car exporter and has sturdy export growth expectations for the near destiny. Similarly, numerous projects by means of the government of India which includes the car challenge design 2026, scrappage coverage, and production-related incentive scheme in the Indian market are anticipated to make India one of the international leaders within the two-wheeler and four-wheeler market with the aid of 2022.
Market Length
The Indian passenger car market used to be worth US$ 32.70 billion in 2021, and it’s miles anticipated to reach a fee of US$ fifty four.eighty four billion via 2027 while registering a CAGR of over nine% between 2022-27. The global EV marketplace was once expected at about US$ 250 billion in 2021 and via 2028, it’s miles projected to develop with the aid of 5 instances to US$ 1,318 billion.
Two-wheelers and passenger automobiles accounted for 75.04% and 21.38% of market shares, respectively, in FY25*. In FY25 (April-September), the full production of passenger motors, commercial vehicles, 3-wheelers, 2-wheelers, and quadricycles was once 1,56,22,388 units.
India accomplished a tremendous milestone, with the sale of 1,00,000 EVs in CY24 in comparison to 82,688 in CY23.
A observe by using CEEW Centre for strength Finance acknowledged a US$ 206 billion possibility for electric powered vehicles in India through 2030. This will necessitate a US$ 180 billion investment in vehicle production and charging infrastructure.
In keeping with NITI Aayog and the Rocky Mountain Institute (RMI), India’s EV finance enterprise is probable to reach US$ 50 billion (Rs. three.7 lakh crore) via 2030.
A report by the India energy storage Alliance anticipated that the EV market in India is in all likelihood to boom at a CAGR of 36% till 2026. Further, the projection for the EV battery marketplace is expected to extend at a CAGR of 30% during the same period.
Indian car industry is concentrated on to boom the export of automobiles through 5 times in the course of 2016-26. In FY23, overall vehicle exports from India stood at forty seven,sixty one,487. Indian vehicle exports of two-wheelers stood at 36,52,122 in FY23.
Investments
To keep up with the developing demand, numerous automobile makers have started out investing closely in various segments of the enterprise all through the last few months. The automobile region obtained a cumulative fairness FDI influx of approximately Rs. three,22,half crore (US$ 36.21 billion) between April 2000 – September 2024. India is heading in the right direction to come to be the most important EV marketplace by means of 2030, with a total investment possibility of greater than US$ 2 hundred billion.
Recent/Planned Investments And Trends
- In December 2024, Mercedes-Benz sold 1,468 luxury cars, the very best within the section, which gave it a marketplace proportion of 0.50%. BMW bought 1,302 motors in December 2024.
- Honda Motor Japan has introduced plans to set up a committed electric powered motorcycle manufacturing facility in India by 2028.
- In January 2025, Pressure Vehicles Ltd announced securing an order to supply 2,429 ambulances to Uttar Pradesh’s fitness branch.
- Tata Passenger Electric powered Mobility and the Rajasthan Sun Company signed an MoU to sell EVs and use sun energy for EV charging.
- In April 2024, Hero Motocorp opened an assembly facility in Nepal with a capacity of 75,000 units per annum.
- Ola Electric IPO to be the first automobile agency in India to launch an IPO in over 2 decades.
- In January 2024, BMW and Mercedes-Benz reported high luxury car sales.
- Hyundai Motor India announced US$ 743.8 million investment in Tamil Nadu, including a ‘Hydrogen Valley Innovation Hub’.
- Mahindra & Mahindra and the India-Japan Fund signed an agreement for a US$ 48.1 million investment.
- At the Vibrant Gujarat Global Summit, Maruti Suzuki announced new Greenfield plant investments.
- Tata and Bharat Petroleum signed an MoU to install 7,000 EV charging stations.
- Hero MotoCorp partnered with Ather for a 100-city fast-charging network.
- In November 2023, TVS Motor entered the European market via Emil Frey.
- Tata Motors inaugurated a vehicle scrapping facility in Chandigarh.
- Tata Motors acquired a 27% stake in Freight Tiger for US$ 17.99 million.
- India saw EV sales of 8,47,439 units in FY24 (till August 2023).
- In July 2023, Mahindra & Mahindra planned to raise US$ 602.72 million for its EV unit.
- Tata Motors announced a US$ 2 billion EV investment over the next 4 years.
- Hero MotoCorp and Kinetic Green revealed investment plans in the EV space.
- Maruti Suzuki planned to invest over US$ 5.5 billion to double capacity by 2030.
- The Central Government sanctioned US$ 72.41 million for 7,432 charging stations.
- Mercedes-Benz, BMW, and Audi posted strong sales in early 2023.
- Nissan and Renault revealed a US$ 600 million joint investment plan.
- Audi India began local production of Audi Q3 models.
- MG Motor India announced a US$ 100 million investment to expand capacity.
- Tata Group Chairman forecasted a 50% EV portfolio by 2030.
- Mercedes-Benz’s global CEO highlighted India as the fastest-growing market in 2022.
- Carmakers committed US$ 10 billion to add 2.2–3 million unit capacity.
- Mahindra planned a US$ 1.2 billion EV plant in Pune.
- Maruti Suzuki to spend US$ 865.12 million on projects including a new facility.
- Maruti Suzuki launched the Grand Vitara at US$ 12,915.
- Hero MotoCorp invested in Zero Motorcycles for electric models.
- Volkswagen began feasibility studies for next-phase India investments.
- TVS Motor lined up US$ 120 million for EV investment.
- Tata Motors committed US$ 3.08 billion over 5 years for passenger cars.
- MG Motors aimed to raise US$ 500 million for EV expansion.
- Hyundai committed to US$ 79.2 billion global EV investment by 2030.
- Ather and Karnataka ESCOMs signed an MoU for 1,000 charging stations.
- Tata Power and Apollo Tyres announced 150 public chargers.
- Kinetic Green collaborated with Aima Group for 2-wheeler EVs.
- HOP Electric Mobility planned a US$ 13.24 million EV production expansion.
- EV startups raised about US$ 673 million until September 15, 2022.
- TVS Motor and BMW Motorrad announced a 2-wheeler EV partnership.
- Hyundai announced US$ 530.25 million investment in R&D and EVs.