Electric vehicle industry ends 2022 with 210% growth; crosses a million mark for the first time

By: Yash Gupte

The 999,949 EVs sold in CY2022 represent a significant 210 percent year-on-year increase over the 322,871 units sold in CY2021.

The electric vehicle sales in India in the calendar year 2022 has brought cheers to the automobile industry in the country. The electric vehicle (EV) market has shown an impressive growth in the past year. The 999,949 EVs sold in CY2022 represent a significant 210 percent year-on-year increase over the 322,871 units sold in CY2021. The two and three-wheeler segments, both referred to as the "low-hanging fruits" of the EV industry, are responsible for the majority of the growth. It makes sense that they are the main drivers of EV sales because they are cheaper than the electric passenger cars or commercial vehicle segments. Taking a look at the number, one might draw a conclusion that the electric vehicle sales in 2022 have missed the mark of one million. But this is not the case as the number 999,949 does not include the sales of EVs in the state of Telangana and the Union Territory (UT) of Lakshadweep. Therefore, it can be said that the EV sales in the country in the previous year has comfortably crossed the mark of one million.

According to the Vahan portal of Ministry of Road Transport and Highways, the electric four-wheeler segment clocked cumulative sales of 37,792 units in 2022. The company with the largest portfolio of EVs, Tata Motors, sold 30,284 units and holds an 80 percent market share. With 3,390 vehicles, MG Motor India holds a 9 percent market share.

With sale of 622,337 units, electric two-wheelers account for 62.23 percent of total EV sales in India in 2022 and 4 percent of India’s overall two-wheeler market which recorded cumulative sales of 1,53,07,255 units. The top 10 (Original Equipment Manufacturers) OEMs – Ola Electric, Okinawa Autotech, Hero Electric, Ampere Vehicles, Ather Energy, TVS Motor Co, Bajaj Auto, Pur Energy, Revolt Intellicorp and Being India Energy – account for 550,562 units or an overwhelming 89 percent of total sales. The electric two-wheeler market was dominated by Ola Electric in 2022 with a sale of 108,130 units followed by Okinawa Autotech with a sale of 101,366 units.

The chart below takes a look at the sales of electric vehicles in the country since 2015.

Source: Vahan Portal, Ministry of Road Transport and Highways

The electric vehicle market in India has come a long way from a sale of 7,772 units in 2015 to around one million in 2022. The highest year-on-year growth in the sale of EVs in the country was recorded in 2016 at 531.22 percent. The EV sales jumped from 7,772 in 2015 to 49,065 in 2016. The rise in product availability in the market, the high cost of petrol, diesel, and compressed natural gas, as well as state subsidies and incentives provided under FAME II scheme, are all factors that contributed to the domestic EV industry's sales growth in 2022. Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME II), is a scheme launched by the Government of India to give a boost to development of Electric Vehicles. The Central Government has allocated a budget of Rs 10,000 crores for the second phase of this scheme. The scheme was launched to achieve the goals of National Electric Mobility Mission Plan (NEMMP). Phase I lasted from 2015 to 2019 and Phase II of FAME was launched in 2019.

Though electric vehicle sales in India have crossed a mark of one million in 2022, there are few concerns which would haunt the future of EV sales in the country. According to Manu Sharma, spokesperson of the Society of Manufacturers of Electric Vehicles (SMEV), “A long-term policy with greater focus on sourcing, a strong supply chain for crucial raw materials such as rare earth metals, and country-level arrangements are the need of the hour to avoid overdependence on midstream suppliers such as China. If these aren't in place, the EV industry's growth plans could be impacted.” He further added that if the supply chain is disrupted due to Covid, there will be a shortage of raw material and semiconductors.