THE FUTURE is here—on four wheels and it is electric. 2025 is shaping up to be the year electric car sales hit the accelerator in India with a flurry of launches. While Tata Motors is the leader of the pack by volume, JSW MG Motor India—JSW Group’s joint venture with China’s SAIC Motor—is closing in. A reignited Mahindra & Mahindra (M&M) is not far behind.

In a first, India’s electric vehicles (EV) industry crossed the sales milestone of 100,000 units in FY25. This was despite electric car sales growth crashing from a whopping 90% in the previous fiscal to 18% year-on-year (YoY) at 108,000 units, according to the Society of Indian Automobile Manufacturers (Siam). The deceleration, attributed to a global narrative of doom and gloom, resulted in an almost stagnant EV penetration of 2.6% in FY25.

However, a slew of launches this year ensured that this tepid growth is a thing of the past. In Q1FY26, battery-electric vehicles (BEVs) accounted for 4.1% of total car sales, up from 2.4% in Q1FY24. “What is heartening is, instead of a few products from a few manufacturers, we now have many more options in the market. The sheer number of choices will make it a more attractive market and lead to higher EV penetration,” says Rajesh Menon, director general, Siam.

The options notwithstanding, three interesting trends define the high traction. “For one, products are coming with a lifetime warranty. They also have a range touching 500 km per charge. Lastly, the charging time is less than half an hour,” says Menon. “This wasn’t the case until a year ago. We didn’t have products with so many propositions.”

The remarkable growth was particularly driven by the premium segment, where car buyers don’t fret about higher upfront costs and access to home charging. There is no range anxiety because these customers may own multiple cars. On the contrary, entry-level EVs face an eternal challenge of range anxiety owing to smaller batteries and a gaping price difference compared to their internal-combustion engine (ICE) counterparts.

Even Tata Motors, which caters to different segments in the EV pie with prices in the ₹8–31.67 lakh range, faced a bumpy ride. The company scaled back its EV penetration target for 2030 from 50% to just above 30%. Its EV sales shrank 10% YoY, from 64,530 units to 57,616 in FY25. This is despite Curvv.ev’s launch last year that took the carmaker’s portfolio from four to five models. Tata’s EV market share contracted from over two-thirds in FY24 to a third in Q1FY26. But this hasn’t deterred India’s top-selling EV maker. It is, in fact, doubling down its presence by entering the full-size SUV segment, where EVs have had smooth sailing. “Frankly, it has been a surprise that there is so much demand in the higher-priced EV segment,” says Shailesh Chandra, MD of Tata Motors Passenger Vehicles and Tata Passenger Electric Mobility. He is bullish and not without reason: full-size electric SUVs are priced on par with the automatic version of their ICE variant, courtesy of a higher tax structure for fossil fuel-powered vehicles. EVs attract 5% GST, while ICE SUVs are taxed at 48%. “The segment has also been able to overcome barriers such as charging speed and range anxiety, compared to other sub-segments,” Chandra says.

In July, Tata Motors opened bookings for Harrier.ev. Later this year, it plans to launch the Sierra.ev in the same segment. With all this, Chandra is confident of reclaiming the 50% market share. “Within this year, we will see a significant recovery of what we had lost,” he quips.

India sells an average of 15,000 EVs every month. For such a small ecosystem, a single product can significantly swing the market share, as JSW MG Motor India’s Windsor EV has proved. The Windsor EV has been powering the bulk of EV sales in India over the past several months. “For 10 months straight, it has been the top-selling EV in the country,” says MD Anurag Mehrotra. MG Windsor targeted those looking for a family-oriented car with rear seat comfort, he adds. At least 70% of JSW MG Motor’s sales comprise EVs. Windsor accounts for 70% of the EV sales, while the Comet and ZS EVs contribute the rest.

In July 2025, the company recorded the second-largest market share of 33% in EVs. Mehrotra says its battery-as-a-service (BaaS) model, accounting for 10% of its EV sales, has brought in a new set of customers with a lower sticker price. In May, the automaker launched the MG Windsor PRO with a bigger 52.9-kWh battery pack. “What gives us the confidence to win in this space is the fact that we have access to technology from SAIC Motor. That technology has scaled and matured. Many of the OEMs in India will have to go through that learning curve, whereas in our case, we get the benefit of access to that technology,” explains Mehrotra.

With a firm footing in the mass-market segment, the carmaker is now eyeing the fast-growing luxury space with the launch of MG M9, an electric luxury multi-purpose vehicle (MPV), and Cyberster, an all-electric roadster in July. Both cars are being sold through MG Select, the company’s premium retail channel.

JSW MG Motor India is buoyant. While India’s total passenger vehicle sales shrank 1% in July, EV penetration nearly doubled to 4.7% from 2.4% YoY. “Notionally, you would think EV adoption will always be higher in metros. But you will be surprised that cities like Chandigarh have 15% EV penetration,” says Mehrotra.

Nalinikanth Gollagunta, CEO of Mahindra’s auto division, may agree. After all, the home-grown carmaker is scripting its biggest turnaround following the launch of two Born Electric SUVs—BE 6 and XEV 9e. M&M’s EV sales soared 226% YoY to 12,647 units in the first half of 2025 from 3,870 in the corresponding period last year. About 60% of M&M’s EV sales come from XEV 9e, while the remaining are from BE 6. “We are at about 40.5% revenue market share in EVs,” says Gollagunta. “If you start chasing volumes, then the notion is you will start to produce smaller cars and try to get volumes. We are very clear that we will get authentic SUVs, which puts us in a certain price bracket. Revenue market share is what we are measuring.” He believes the company’s range of 480 km with the 79-kWh battery pack is a “game-changer”. “Increasingly, customers are using XEV 9e as the primary car in their household.”

M&M harbours big ambitions for global markets such as Australia, South Africa, and the U.K., where it competes with Chinese players. “So, the batteries have to be the best in class. We use BYD blade cells. You can’t have just one or two products. You have to have a series of products so that dealers have the confidence that these guys are in the market,” the CEO says.

Hyundai Motor India Ltd (HMIL), too, has had a blockbuster year with around 4,000 EVs sold in the first half. The South Korean carmaker witnessed a fivefold jump in EV sales after the launch of the Creta EV earlier this year. But the popularity of its ICE sibling hasn’t helped the EV much as its sales hover around 600-700 units per month. But Creta is part of HMIL’s long-term strategy as it gears up to launch six EVs next year. “The Creta EV helps us to meet emission norms. It will help us create a supply chain and infrastructure so that new EVs gain volumes going ahead,” says Tarun Garg, chief operating officer. With EV penetration ascending, he says the company is looking to invest heavily in charging infrastructure as well as the supply chain.

HMIL was among the first companies to test the Indian market with an EV as it rolled out the Kona Electric, priced around ₹25 lakh, in 2019. However, the company struggled to make inroads. Its second EV, the flagship IONIQ 5, appealed to several premium buyers who could shell out ₹46 lakh for a car. The company has continued this top-down approach with the Creta EV, with prices starting at ₹18 lakh (ex-showroom).

Targeting a similar price segment, Kia, Hyundai’s sister mass-premium brand, launched its first ‘Made-in-India’ electric car, the Carens Clavis EV, in July. The 7-seater is an MPV. “While most EVs today are compact SUVs lacking flexibility, the Carens Clavis EV bridges this white space,” says Joonsu Cho, chief sales officer, Kia India.

Another electrifying launch was that of e VITARA, Maruti Suzuki’s maiden EV that was rolled out for exports from its Gujarat plant in late August. This fiscal, India’s largest carmaker plans to manufacture 50,000 units of the export-oriented e VITARA. The domestic launch is also not far away. Suzuki Motor Corporation has chosen India as its global EV manufacturing base. Although late to the race, the Japanese carmaker is looking to leverage exports to become the country’s top electric car manufacturer within a year. By FY31, Maruti Suzuki plans to roll out six BEVs and expects 15-20% sales from the electric segment. According to MD and CEO Hisashi Takeuchi, India comes with the advantage of cheaper electricity. “India’s electricity prices are much lower at ₹7-8 per kilowatt, one-third of that in Japan. For customers, the running cost of EVs is much cheaper than normal ICE cars,” he had told Fortune India earlier this year.

While mass-market vehicles have a long road ahead, their counterparts in the premium and luxury segments are enjoying a purple patch. Chinese carmaker BYD, a premium player, is India’s fifth-largest EV maker. “Since the past six months, we have been averaging 500-550 cars each month. The Sealion 7, launched in January, has been the top-selling EV for us this year,” says Rajeev Chauhan, head of electric passenger vehicles business at BYD India. “Most of our Sealion customers already have a luxury car in their household.”

He says the company will continue to focus on the premium segment of ₹25 lakh and above. “Let the market evolve and mature. We see this (mass market) segment broadening up and the feasibility would start appearing for low-cost EVs.” BYD’s EV portfolio currently comprises four models. The company is still awaiting a green signal from the Centre to set up a domestic manufacturing unit.

Local manufacturing helps; ask German giant Mercedes-Benz India. “We localised the manufacturing of top-end EVs such as the EQS SUV and EQS sedan,” says Santosh Iyer, MD & CEO. His company looks beyond the entry-level EVs. “There are more players in the entry segment. We have the EQA and the EQB in the entry luxury EV space, but these are priced like CBUs (completely built-up units) compared to localised versions from rivals that are priced around ₹50 lakh,” he says.

That said, he feels the right product, the CLA Electric (expected to be launched in India later this year) with the Modular Architecture (MMA) platform, should be a much better option when it comes to entry-level luxury EVs. About 8% of the company’s sales came from EVs this year, a twofold rise from 4% in 2024. Around 75% of Mercedes-Benz’s EV sales come from top-end vehicles such as the EQS sedan, the EQS SUV, EQS SUV Maybach, and the G-Class electric. This year, the largest luxury carmaker in India launched three EVs.

But does the company feel threatened by Elon Musk-led Tesla’s India entry? Mercedes-Benz India’s overall entry segment share is 8-10%, including ICE, Iyer says. “The maximum impact they can have is on 10%. That is also limited. Customers may buy Tesla as one of the cars in the household, but that’s not going to cannibalise my current cars.”

Instead, Iyer believes the late entry will dampen Tesla’s expectations. “The novelty factor from three to four years ago no longer exists,” he says, questioning if the Indian consumers will accept Tesla’s limited presence where there are no dealers and only a few workshops.

Meanwhile, Mercedes’s German peer BMW has been the table-topper in India’s luxury EV space for the past three years. It didn’t just jump on the EV bandwagon; instead, it crafted a well-thought-out strategy. “Our aim was that at every price point, a customer gets to choose from a petrol, diesel or electric [variant]… You are not just following a trend, you are creating a market by addressing the needs of the customers,” Vikram Pawah, the then president & CEO of BMW Group India, told Fortune India in July.

The iX1 Long Wheelbase, launched at the Bharat Mobility Global Expo in January, has become BMW’s best-seller in India, followed by the i7 sedan. “We sold over 5,000 EVs in the past three years. The penetration rates are phenomenal. This year, we are almost at 18% penetration, growing from 2% when we started selling around three years ago,” Pawah had said.

He believes that the EV customers are an evolving lot. “People had range anxiety, but not anymore. The charging pattern has changed. They charge once a week. Earlier, even if the SOC (state of charge) was 80%, they would plug in to charge. Now you can see that customers are normally plugging in when SOC comes down to 30%.”

BMW is confident of maintaining its EV supremacy. “It’s not only about launching a product. It’s the complete ecosystem we created for it,” Pawah had said.

As the EV bandwagon enters the fast lane, price parity, or the lack thereof, with the ICE vehicles remains a concern. EVs are priced significantly higher than ICEs. “One of the reasons is to take out range anxiety; you have to put a lot of range in the car. The moment you do that, you are adding cost,” Mercedes’s Iyer weighs in. This lack of parity is why the EV story runs on incentives across the globe. “Customers are not ready to pay a premium for the environment. If you are not able to bring price parity through interventions, you will not be able to make a significant gain,” he believes. However, Kia’s Cho says many EVs now match or even undercut their ICE counterparts in terms of ownership cost. “A broader parity across segments, driven by economies of scale and improved technology, is expected in due course of time.”

As to India hitting an inflection point in EVs, Siam’s Menon says it is difficult to predict a timeline. “We are hopeful we will be able to scale up much faster than the way we have so far. Look at what’s happened with two-wheelers and three-wheelers.” Menon is optimistic. So is the industry.