India’s EV industry must prepare for a post-subsidy market, Heavy Industries Secretary says
Heavy Industries Secretary Kamran Rizvi said EV subsidies will phase out over time, pressing manufacturers to build commercially viable demand. Electric three-wheelers already account for about half of segment sales, while e-bus and e-truck adoption is expected to accelerate.
What happened
India electric mobility industry · Heavy Industries Secretary Kamran Rizvi said EV subsidies will eventually end, requiring India’s mobility industry to become
Key facts
- Electric three-wheelers account for around 50% of three-wheeler sales
- Earlier electric three-wheeler target was 10% by 2026
- Electric three-wheelers could reach 75% of sales in two-three years
- Electric two-wheelers account for around 7% of sales
- Electric cars account for around 4-5% of sales
- India needs to electrify around 1.5 lakh public transport buses
- India has around 20 lakh privately owned buses, with at least half needing electrification
- 160 cities are expected to have electric buses in two-three years
- Around 100 electric trucks were supported under FAME-II
- Electric trucks could reach at least 25% of heavy-category sales in five years
Why this matters
EV companies should prioritize partnerships or acquisitions in vehicle financing, charging infrastructure and fleet services to sustain demand in a post-subsidy market.
What to watch
- Formal timeline and scope of subsidy reductions, including whether commercial fleets retain targeted support.
- EV retail prices after subsidy changes and OEM willingness to absorb part of the gap through discounts or lower-cost models.
- Battery-cell and pack price trends, which determine whether manufacturers can preserve affordability without incentives.
- Growth in EV loan approvals, lease penetration, interest-rate subsidies and default rates for commercial operators.
- Public and depot-charging additions, charger uptime and electricity tariffs for fleet charging.
- Electric three-wheeler, e-bus and e-truck monthly registrations relative to internal-combustion alternatives.
- Fleet procurement announcements from e-commerce, grocery, quick-commerce and third-party logistics operators.
- Retailers and delivery platforms should identify routes where EV total cost of ownership remains favorable without subsidies and prioritize high-utilization fleets.
- Auto dealers should shift from subsidy-led sales messaging toward monthly-payment, operating-cost and resale-value propositions.
- OEMs should increase partnerships with NBFCs, banks and leasing providers to reduce upfront-cost friction and manage battery residual-value risk.
- Large-format retailers, fuel stations and logistics hubs should evaluate charging deployment where dwell time, grid access and fleet density support utilization.
- Fleet buyers should renegotiate vehicle procurement around uptime guarantees, battery warranties, service turnaround times and charging-energy contracts.