In 2025, India’s automobile market achieved a significant milestone, with 28.2 million vehicle registrations, reflecting steady growth throughout the year and a notable surge during the festive fourth quarter. A key trend driving the market was the increasing adoption of electric vehicles (EVs), which accounted for 2.3 million units, representing an 8% share of new vehicle sales. This growth was strongly supported by government incentives, including GST benefits, and the entry of global players such as Tesla and VinFast, which encouraged consumer interest in cleaner and more sustainable transportation options.
The electric two-wheeler segment remained the main driver of EV adoption, contributing 57% of total EV sales with 1.28 million units sold. While the overall two-wheeler market was still dominated by traditional manufacturers like Hero MotoCorp and Honda, the electric segment became highly competitive, with TVS Motor Company leading the market at 23% share, closely followed by Bajaj Auto. In addition, the electric three-wheeler market showed remarkable growth, particularly in the high-speed L5 category, where EV penetration reached 32%, the highest across all vehicle types. Companies such as Mahindra Last Mile Mobility and Bajaj Auto emerged as leaders in this category, together controlling nearly 70% of the high-speed electric three-wheeler market.
The passenger car segment also reached record numbers, with 4.4 million vehicles registered. Electric cars accounted for approximately 1.76 lakh units, led by Tata Motors, which held a 40% market share. In the luxury EV segment, BMW continued to lead, while JSW, MG Motor, and Mahindra Electric maintained strong positions. Commercial vehicle electrification is still in the early stages, but progress is visible. Electric buses saw 4,441 registrations, and electric goods carriers reached nearly 11,000 units, with Tata Motors leading in both categories.
Geographically, Uttar Pradesh emerged as the largest EV market, contributing over 4 lakh units and 18% of the country’s total EV sales. Maharashtra and Karnataka followed as the next largest markets. Smaller states and territories such as Delhi, Kerala, and Goa showed the highest ratio of EVs to internal combustion engine vehicles, indicating that urban-focused policies are successfully promoting adoption. Eastern states like Tripura and Assam also displayed high EV-to-ICE ratios, highlighting a growing spread of electric mobility across different regions.
A major aspect of India’s transition toward electric mobility is the government’s strong focus on green public transport. In 2025, the largest-ever electric bus tender was successfully concluded by Convergence Energy Services Limited (CESL). The tender, part of the ₹10,900 crore PM e-Drive scheme, aims to deploy more than 14,000 electric buses across 169 cities. Key winners of the tender included PMI Electro Mobility, which secured nearly half of the contract, along with EKA Mobility and Olectra Greentech. These buses will operate under a Gross Cost Contract model, where private operators manage maintenance, while state authorities provide infrastructure such as depot land and power connections. This large-scale procurement is expected to reduce costs significantly and provide a clear roadmap for the long-term electrification of India’s public transportation system.
Overall, 2025 has been a defining year for India’s automobile industry, marked by steady overall growth and rapid EV adoption. The expansion of electric two-wheelers, high-speed three-wheelers, passenger cars, and public transport solutions indicates that India is steadily moving toward a cleaner, more sustainable mobility ecosystem. Government policies, market competition, and urban initiatives are all playing a crucial role in shaping this transition.
