A new scooter every 90 seconds. India’s EV revolution has begun

In a bustling startup factory in Hosur, near Bangalore, electric scooters are rolling off the assembly line at an impressive rate of one every 90 seconds. Tarun Mehta, the 33-year-old CEO of Ather Energy, observes that demand for electric scooters is surging. Three years ago, the company sold around 200 units monthly; today, it exceeds 15,000 units each month. “Revenues are skyrocketing,” Mehta told CNN.

India is rapidly transforming its massive personal vehicle market, which is expected to reach $100 billion by 2030. Two- and three-wheelers dominate the transport landscape, outnumbering cars by a factor of four. In cities like New Delhi and Bangalore, electric mopeds are increasingly common, with prices starting at about $1,000. Environmentalists and government officials tout them as a solution to the severe air pollution choking many Indian cities.

Over the past three years, electric vehicle (EV) registrations have increased tenfold nationwide. In Delhi, battery-powered rickshaws are replacing human-pedaled ones, helping to reduce urban pollution. Established companies such as Hero MotoCorp are investing heavily in electric models, and the Indian government aims to have EVs comprise a third of all private car sales and 80% of two- and three-wheeler sales by the end of the decade. This push is intended to set a benchmark for other developing nations.

Despite these advancements, significant challenges remain, including reducing costs and expanding infrastructure. Brajesh Chhibber from McKinsey notes that nearly 7% of two-wheelers sold last year were electric, a dramatic increase from virtually zero three years ago. This surge is largely driven by the government’s “FAME” (Faster Adoption and Manufacturing of Electric Vehicles) initiative, which has invested over 100 billion rupees (about $1.2 billion) in EV subsidies and charging infrastructure.

Subsidies have made a substantial impact. For example, in Delhi, the cost of a high-speed electric two-wheeler is now only 15% to 20% higher than its diesel counterpart, thanks to these subsidies. This has encouraged many consumers to make the switch.

Ather Energy is one of many startups benefiting from this shift, joining at least 55 other new EV manufacturers. Yet, despite the progress, India’s 1 million EVs sold last year represent a small fraction of the 250 million two- and three-wheelers currently in use. The World Economic Forum highlights the enormous potential for growth in this sector.

With public transport infrastructure still underdeveloped, two- and three-wheelers remain crucial, representing 80% of all vehicle sales. This trend positions India favorably for EV adoption, as these vehicles are typically used for short commutes rather than long journeys. Bain’s report indicates that two- and three-wheelers will likely lead EV adoption due to their reliance on home charging rather than public infrastructure.

Delivery and logistics companies are also driving EV adoption, attracted by the lower operating costs and environmental benefits. Major companies like Flipkart and Zomato have committed to converting their fleets to EVs by 2030.

However, India faces significant hurdles, particularly in charging infrastructure. The government is working to expand networks in 68 cities and along major highways, but the vast and diverse geography of India poses challenges. The World Economic Forum estimates that $285 billion is needed to fully electrify India’s two- and three-wheeler markets.

Anmol Singh Jaggi, CEO of BluSmart, an all-electric ride-sharing company, cites the lack of charging stations as a major obstacle. “Despite our large super hubs, we still lack sufficient large-scale charging infrastructure,” he said.

Consumer skepticism also persists, with concerns about the safety, reliability, and cost of EVs. Educating customers about the economic benefits, such as fuel and maintenance savings, is essential. According to manufacturers, the high cost of fuel means that electric scooters and motorcycles can start saving money for their owners within a year.

As battery prices continue to drop and manufacturers achieve greater scale, the electric vehicle market in India is expected to grow significantly. Jaggi believes that this represents a unique opportunity for entrepreneurs and the industry as a whole, signaling a major shift in transportation.