EV Market Share Crosses 4% In May, Tata Leads Segment

Electric passenger vehicles (EVs) accounted for over 4% of total passenger car sales in India in May 2025, marking a significant rise from 2.6% in the same month last year, according to the latest retail sales data released by the Federation of Automobile Dealers Associations (FADA).

This marks a 0.5 percentage point increase over April’s EV share of 3.5%, indicating a steady upward trend in electric car adoption. A total of 12,304 electric cars were sold in May, compared to 8,029 units a year ago. Sales in April stood at 12,233 units.

“This is an important milestone in our industry’s journey towards electrification,” said Saharsh Damani, CEO of FADA. “The growth is being driven by better battery technology, improved range, and falling costs of EVs compared to earlier models.”

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Tata, MG, Mahindra Dominate EV Market

Tata Motors retained its lead in the EV space with 4,351 units sold in May. JSW MG Motor followed closely with 3,765 units, registering a 149% year-on-year surge. Mahindra & Mahindra took third place with 2,632 units sold. Together, these three companies accounted for over 87% of all electric car sales last month.

Supply Chain Risks on the Horizon

Despite the momentum, FADA cautioned that global supply-chain challenges, especially those related to rare-earth materials, may dampen EV growth in the coming months. China, which controls the bulk of global rare-earth magnet production used in EVs, has begun tightening export regulations.

“If the supply situation for rare earth materials doesn’t improve, we could see production slowdowns that may impact retail sales in the near future,” Damani warned.

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Govt Pushes For Global Investments in EVs

In a move to further bolster EV adoption and local manufacturing, the government on Monday notified new guidelines aimed at attracting foreign investment. Under the scheme, approved applicants—including global players like Tesla—will be allowed to import electric four-wheelers with a minimum CIF value of $35,000 at a reduced 15% customs duty for five years.

To qualify, companies must commit to a minimum investment of Rs 4,150 crore. The number of EVs allowed under the reduced import duty will be capped at 8,000 units annually, with unused quotas eligible for carryover.

The policy is designed to promote India as a global hub for electric vehicle manufacturing and support the country’s broader green mobility transition.

(With inputs from IANS)