India EV Profile: Robust Growth, But Penetration Remains Low

Key View: We forecast passenger EV sales growth of 219.9% y-o-y in FY2022 to reach over 45,000 units sold annually. We also highlight that as many non-EV vehicles are in very short supply (due to chip shortages and the prioritisation of EV production), the local EV market is gaining more interest from consumers. Additionally, we note that the very high levels of pollution in Indian cities (especially following the drop in pollution amid the Covid-19 lockdown) will likely see more consumers gravitate to EVs. We forecast India’s passenger EV penetration rate to reach just 1.22% of total passenger vehicle sales in 2022. As more EV models become available in India over 2022-2026, we will likely see stronger EV uptake; however, it will depend heavily on if the Indian government continues to severely tax imported vehicles and components from Mainland China.