Electrifying shift: Hatchbacks to luxury wheels, India's EV moment is here

As EV market matures, Indian consumers now have clear choices across budget, mid-range, and premium segments - and the first Tesla buyer in the country signals that aspiration has joined affordability

electric vehicle — For years, the EV story in India was about fuel savings, subsidies, and sustainability. In 2025, they’re equally about status, technology, and choice.

8 min read Last Updated : Oct 09 2025 | 5:29 PM IST

When Siddharth Jain, executive director at Inox Group, became India Inc’s first Tesla buyer this August — dedicating his Model Y “to Elon Musk” — it wasn't just a celebration of a car purchase, it marked a milestone for India’s electric-mobility story.

For years, the EV story in India was about fuel savings, subsidies, and sustainability. In 2025, they’re equally about status, technology, and choice.

From Rs 8 lakh hatchbacks to Rs 80 lakh SUVs, India’s EV market now spans the full spectrum — reflecting how the country’s five-million-plus EV owners (across two-, three- and four-wheelers) are influencing how India gets from point A to point B and everywhere in between.

The Big Picture: A market on the move

While 2025 was the year Tesla came to India, the EV revolution had already taken a hold, with major domestic and international players having a model or two in their showrooms.

“Gone are the days when electric cars were a novelty. Today, they’re fast becoming a statement of sustainability and smart living,” says Atul Jairaj, partner, Deloitte India. “India’s electric passenger-vehicle market contributed around 2.3 per cent of the overall passenger-vehicle market at the close of FY 2025 and is expected to reach 12–15 per cent by FY 2030. While the overall PV market grew 11 per cent between 2020 and 2024, the electric-passenger-vehicle segment surged at a 129 per cent CAGR. The luxury-EV segment grew even faster — 291 per cent CAGR.”

According to Jairaj, interest is broad-based: “Some luxury EVs now offer ranges above 850 km, addressing inter-city travel anxiety, while mid-range brands are positioning themselves around smart, stylish city driving. We also see experimentation with battery-as-a-service to cut upfront costs.”

Meanwhile, carmakers are ensuring there’s an electric option for every budget.

Vinay Raina, chief commercial officer, JSW MG Motor India, says: “At JSW MG Motor India, we’ve built a multi-dimensional portfolio — from the compact Comet EV to the spacious Windsor and the dynamic ZS EV — each designed for evolving customer expectations.”

Similarly, domestic automaker Tata Motors has become a major player in the Indian EV market. In September 2025, it sold 9,191 EVs, up 96 per cent year-on-year, while Q2FY26 saw nearly 25,000 EVs driving out of showrooms, putting the company on course to cross one lakh units annually. EVs now contribute 17 per cent of Tata’s total car and SUV sales.

“Five years ago, adoption was driven mainly by affordability and low running costs. Now the conversation has moved beyond price to a complete ownership experience — technology, range, performance and comfort," a Tata Motors spokesperson said. "Customers today are satisfied when an EV delivers 500 km plus, which explains the popularity of high-performance models like the Harrier.ev.”

The growing adoption of EVs as primary cars, the spokesperson said, “marks India’s transition from early adoption to mainstream acceptance, signalling a market ready for a broader, segment-focused EV portfolio.”

However, Jairaj warns against range-lifestyle mismatches. “A city commuter may find 250–300 km adequate, but highway travellers should look for 400 km or more," he says, urging buyers to match their range with their driving needs.

Thankfully, that is not such a huge problem, given there is now literally an EV for every need and at every price point.

The Economy EV: Pragmatic and price-led

This is where India’s EV volume story will likely unfold. Models such as Tata Tiago EV, MG Comet, and Citroën ë-C3, priced between Rs 8 lakh and Rs 15 lakh, dominate this space. They offer a modest 200–300 km range, fast-charging, and essential connectivity.

Buyers typically tend to be urban commuters shifting from small petrol cars to save on running costs. “Most first-time EV buyers don’t need long range — they need reliability and low maintenance,” says a Delhi dealer. “If the car runs 50–60 km a day, that’s well within what entry EVs handle.”

The mid-end EV: Value meets aspiration

Between Rs 15 lakh and Rs 25 lakh lies the sweet spot where consumers want both economy and excitement. The Tata Curvv EV, Mahindra BE.6, and BYD Atto 3 set new benchmarks for design, performance, and as high as 400–500 km range.

These mid-segment cars boast premium interiors, ADAS safety, and fast-charging — offering a genuine upgrade for families moving up from compact SUVs.

Corporate fleets — especially tech startups and ESG-driven firms — are also fuelling this segment, seeing EVs as a brand statement as much as an operational choice, given its running costs.

Premium EV: Status, statement, technology

At the top end (Rs 30 lakh or more) is a space once dominated by German sedans, now shared with global EV giants. The segment includes Tata Harrier EV, Mahindra XEV 9e, BMW i4, Mercedes EQA, and newcomers like VinFast VF7.

The arrival of Tesla’s Model Y earlier this year has reignited the aspirational spark. With a price upwards of Rs 70 lakh (after import duties), it caters to those seeking the halo effect of owning a Tesla — India’s new badge of tech-savvy affluence.

These vehicles deliver real-world ranges above 500 km, top speeds of 200 km/h, advanced connectivity, over-the-air updates, and near-silent powertrains.

Here, spending is emotional — about success, innovation, and eco-conscious identity rather than cost.

How Indians spend on EVs: The new economics of desire

Raina explains that “Over a five-to-seven-year horizon, MG EVs prove more cost-effective than ICE counterparts even after factoring purchase, charging, servicing and resale.”

Electricity costs in India average Rs 1 per km, versus Rs 7–9 for petrol or diesel. This, combined with lower maintenance, gives a payback horizon of about five years.

MG has also introduced Battery-as-a-Service (BaaS) to complement its EVs, decoupling battery cost from vehicle price. Customers lease batteries at a fixed per-km fee, lowering initial investment and ensuring predictable costs. Plans include lifetime battery warranties and buyback assurance, “...making electric not just sustainable but smarter and more rewarding,” says Raina.

As an added bonus, MG packs its EVs with IP67 and IP69K-rated battery protection — resistant to dust and water up to 60 cm depth — critical for Indian monsoons.

Roadblocks Ahead

Despite optimism, challenges remain. The biggest one, of course, is the lack of reliable charging infrastructure on a national level. Battery charging-cum-swapping stations remain negligible, and the charging network is patchy, at best, except on major highways.

On the consumer side, Jairaj says home charging is almost non-negotiable — about 70 per cent of consumers prefer it, according to Deloitte’s Global Automobile Consumer Survey 2025. But that is easier said than done, especially in metros like Mumbai, where most cooperative housing societies' parking has not been built or wired for setting up a charging point. The network of public charging stations outside of metros remains patchy.

Then there's the issue of battery replacement. At Rs 5–7 lakh per replacement, the cost remains a concern.

Meanwhile, domestic battery manufacturing is subject to geopolitical tensions, given China's near-monopoly on rare earth minerals that are critical to battery production.

Additionally, import duties on completely built up (CBU) units stay high (up to 70 per cent), constraining premium imports.

The secondary market for resale also is yet to mature, given that most buyers are likely to keep driving their EVs for much longer than ICE cars because there are no scrappage rules for EVs yet.

Battery recycling, domestic cell manufacturing, and power-grid readiness will shape how quickly India’s EV story extends beyond metros.