Hybrid, EVs each could have 8 per cent market share by FY28: ICRA

The competition between strong hybrid cars and electric vehicles (EVs) is expected to remain stiff, and each of them could have an eight per cent volume share in the Indian domestic passenger vehicle market by 2027–28, according to ratings agency ICRA. In 2023–24, strong hybrid cars and EVs each had a two per cent share in the domestic passenger market.

The share of compressed natural gas (CNG)-run cars is also expected to increase from 14 per cent in 2023–24 to 18 per cent in 2027–28. “Over the period of 5–10 years, you will see different powertrains continuing, and it will be a challenge for companies to prioritise their investments (based on powertrains),” said Shamsher Dewan, senior vice president and group head (corporate ratings), ICRA, while addressing reporters.

“Hybrids are a trade-off. You get better mileage. At the end of the day, you do not have range anxiety as there is an internal combustion engine (ICE). Just with two major players—Maruti and Toyota—strong hybrid cars' penetration has reached two per cent,” he explained.

He added that EVs, being a new technology, are currently in an evolving phase. “For example, if you are able to get a vehicle at a low price point with a solid-state battery, it could have a range of up to 600–700 km, and this could change the entire game,” he said. However, diverse powertrains will ultimately shape the future of the Indian automobile industry.