EV two-wheelers will capture 100% market by 2027: Niti Aayog

Despite several cases of electric vehicles (EVs) catching fire in recent months, the Union government is gung-ho about the new electricity-driven two-wheelers achieving 100% penetration in the Indian market in next five years.

Niti Aayog, the government think-tank, gave an ‘optimistic scenario’ to suggest 100% penetration of electric two-wheelers (e-2W) in the Indian market by financial year 2026–27. Conditionally, the Niti Aayog suggests e-2W sales may cross 2.2 crore units in the financial year 2028–29.

The country’s top planning organisation’s assessment is mainly based on the assumption that battery costs would drop by 8% every year in the coming five years. Also, it is expected that load carrying capacity of the EVs will increase by over 10% by 2027, thus attracting more buyers.

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In case the battery cost comes down by 2% only and no significant improvement in range and performance is seen, the electricity-driven two-wheeler sale would still touch the 55 lakh unit mark (21.86% penetration) by 2031, says the Niti Aayog report.

In case of ‘challenged diffusion’ situation with no significant change over present day technology and demand incentive in place, the market penetration would be about 5.82% by 2024.

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For financial year 2021-22, electric two-wheeler sale in India was about 2.31 lakh units, a good 450% growth over the previous year. However, its market penetration still remained around 2%.

Industry players believe that EV sale in the two-wheeler segment will be around 15-20% by financial year 2026.