New Delhi
Recent data analysis by Care Edge Ratings indicates a notable shift in consumer preferences within the automotive industry. Traditional fuel-powered vehicles are facing a gradual decline in demand, with a noticeable uptick in interest towards alternative fuel options.
Between 2020 and 2023, the proportion of petrol vehicle sales decreased from 86% to 76%, while diesel vehicle sales saw a slight drop from 12% to 11%. Meanwhile, the sale of alternative fuel-driven vehicles skyrocketed by over 400% in 2023 compared to 2020.
Electric vehicles (EVs) have emerged as the most cost-effective option over a lifetime, closely followed by Compressed Natural Gas (CNG) vehicles. Government incentives, coupled with escalating fuel costs, particularly for petrol and diesel, are driving the surge in EV demand. India aims to have 30% of all vehicle sales electric by 2030.
To support this transition, the Indian government has launched various initiatives to incentivize the development of alternative fuel infrastructure, including subsidies and grants.
With an enhanced allocation of Rs 1,500 crore towards the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME-II) scheme, the Indian government is further bolstering the EV adoption drive.
Arti Roy, Associate Director at CareEdge Ratings, highlights that the future of the Indian automobile market hinges on government policies, technological advancements, and consumer preferences.
