Electric vehicle sales saw surge in FY26 on strong year-end push

Electric vehicle sales rose sharply in FY26, driven by strong growth in two- and four-wheelers and a robust year-end push, as per Vahan registration data

India’s electric vehicle (EV) market witnessed a strong surge in financial year 2025-26 (FY26), driven by robust growth in both two- and four-wheeler (e2W and e4W) segments, and a sharp year-end push, according to Vahan portal data on vehicle registrations.

 

e4W registrations nearly doubled, surging 91.3 per cent year-on-year (Y-o-Y) to 193,633 units in FY26, compared with 101,205 units in FY25. In FY24, there were registrations of 80,495 units.

 

e2Ws grew 21.8 per cent to 1.40 million units in FY26, up from 1.15 million units in FY25. The figure was 948,586 units in FY24.

 

The growth momentum accelerated in the fourth quarter (Q4), between January and March 2026. e4W sales rose from 14,177 units in February to 21,716 units in March, a 53.2 per cent month-on-month (M-o-M) increase, while e2W sales surged 70.1 per cent to 184,300 units from 108,357 units in the same period.

   

January had already set a strong base, with 18,875 e4Ws and 119,195 e2Ws sold, highlighting sustained demand through the quarter before a sharp March spike.

 

Experts believe the surge in FY26 was underpinned by multiple structural factors, including a steady expansion of charging infrastructure, a wider range of feature-rich models launched across price segments, and improved supply chains that enabled faster deliveries.

 

Financing options have also become more accessible, lowering entry barriers for first-time EV buyers, while reduced battery costs and localisation efforts have supported competitive pricing. In addition, year-end dispatches and dealer-level incentives typically seen in Q4 further amplified volumes.

 

The strong momentum comes amid rising global uncertainties, particularly tensions in West Asia, which have pushed fuel prices, perhaps prompting consumers to consider EV options.

 

Industry experts say the e2W segment is entering a more mature phase. “The e2W market share for FY26 is around 9 per cent, up roughly 1.4 times from about 6.3 per cent in FY25. The market has entered the next phase of maturity despite subsidies reducing, and sales have continued to grow," said Anurag Singh, managing director at Primus Partners.

 

Singh added that supply chains and production capacity have improved significantly, and most models coming to market are now well-engineered.

 

Rajat Mahajan, partner, Deloitte India, said India’s EV sector has witnessed significant momentum in FY26, driven by rising demand for feature-rich vehicles across both e2W and e4W segments. “Improving infrastructure, frequent product launches by OEMs (original equipment manufacturers), and the recent disruption in fossil fuel supply have led customers to go for the EV option. In e2Ws, the growth has been more than 20 per cent, while in e4Ws it is upwards of 80 per cent compared to FY25, with March driving volumes,” he said.

 

Mahajan added that there has also been a consistent policy push supporting EV adoption, including the continuation of lower goods and services tax (GST) rates, improving access to financing, and the extension of the PM E-DRIVE scheme for e2Ws until July 31, 2026.

 

Experts also pointed out that penetration is expected to rise steadily in the coming years, coexisting alongside petrol-powered 2Ws.

 

While any spike in crude oil prices typically strengthens the case for electrification, it can also lead to higher logistics and input costs across the supply chain. How demand plays out in FY27 remains to be seen.