In EV penetration race, India's electric two-wheelers still in rearview

India may be the second-largest market for electric two-wheelers (e2Ws) globally, having sold 0.9 million vehicles in the calendar year (CY) 2023. However, the situation differs when it comes to e2W penetration. China leads with a 35 per cent market share in CY 2023, followed by Vietnam at 9 per cent, Europe at 7 per cent, and India at 5 per cent, according to data from the International Energy Association (IEA). The ‘Other Asia’ category — which includes Bangladesh, Singapore, Sri Lanka, Taiwan, Pakistan, Myanmar, Nepal, and Mongolia — collectively holds a 4 per cent share.

India’s lower penetration, compared to these countries, is mainly because the e2W revolution, both in India and globally, has been driven by electric scooters. In India, scooters (both internal combustion engine and electric) account for only 30 per cent of the total two-wheeler market, with the rest dominated by motorcycles. Only a few manufacturers offer electric motorcycles, with negligible sales volumes — though this could change when Ola Electric launches its electric motorcycle range in the first quarter of CY 2025.

In contrast, scooters dominate 80-85 per cent of the Chinese two-wheeler market and 70-75 per cent in the Association of Southeast Asian Nations (Asean) countries. In North America and Europe, electric innovation has focused more on heavy motorcycles (which account for 50-60 per cent of total two-wheelers), with scooters representing 25-30 per cent of the market.

China leads the e2W market, selling 5.9 million vehicles in CY 2023 — six times more than India — although this represents a 25 per cent drop from CY 2022.

According to the McKinsey Center for Future Mobility, this gap is expected to persist. Projections indicate that China’s e2W market (including bikes with a top speed of under 25 kilometres per hour) could reach 65-70 million by CY 2030. In comparison, India’s market is projected to grow sevenfold to ninefold (7-9 million vehicles), which would still be only about one-seventh the size of China’s. Asean countries are expected to reach 3-4 million vehicles, while Europe and the Americas could each see 0.5-1 million vehicles.

In CY 2023, the global e2W market contracted by 18 per cent, largely due to supply constraints from lingering pandemic restrictions in China. While other markets, such as India (where sales rose 40 per cent compared to CY 2022) and some Asean countries, performed well, China’s dominance — accounting for 78 per cent of global e2W sales — meant its decline couldn’t be offset by gains elsewhere.

The good news for India is that it has quietly overtaken China to become the largest electric three-wheeler market in the world, selling 580,000 vehicles in CY 2023 compared to China’s 320,000, according to IEA data. In CY 2022, both countries were neck and neck at 350,000 vehicles each, but China has since seen a decline in sales.

As a result, three-wheeler penetration in India surged to 54 per cent in CY 2023, up from just 22 per cent in 2020. Meanwhile, China’s penetration dropped to 12 per cent in CY 2023, down from 15 per cent in CY 2020.

 

Country	Electric two wheeler share in the country in CY 2023 (in %)	Electric two wheeler share in the country in CY 2022 ( in %)	Electric three wheeler share in the country in CY 23 (in %)
China	35	45	12
Vietnam	9	8	0
Europe	7	9	39
India	5	4	54
Other Asia	4	4	1
Latin America	1	1	2
North America	1	1	2

Source IEA