Scooters set to overtake motorcycles as EV shift reshapes India's 2W market

Replacement demand recovery is expected to support near-term growth, while rising electrification and changing consumer preferences may drive scooters to overtake motorcycles in the long run

India’s two-wheeler market is approaching a structural inflection point, with scooters on course to overtake motorcycles in volume terms over the next decade as electrification accelerates and reshapes consumer preferences, according to a report by Equirus Securities.

 

According to the brokerage, scooter volumes will grow at roughly 9 per cent annually between FY25 and FY30, outpacing motorcycles, which are expected to expand at about 4 per cent over the same period. This widening gap is projected to culminate in scooters surpassing motorcycles after FY37, marking a decisive shift in the composition of the world’s largest two-wheeler market.

 

The transition reflects a combination of socio-economic changes: Rapid urbanisation, rising participation of women in the workforce, and a tilt towards convenience-led mobility. Electrification, however, remains the central driver, and scooters hold a structural edge here.

   

Electric two-wheelers are set to be the fastest-growing segment, with volumes expected to rise at a compound annual rate of around 34 per cent between FY25 and FY30. Penetration, currently in the low single digits, is projected to climb to about 19 per cent by FY30 and over 50 per cent by FY40.

 

Within this shift, electric scooters dominate. Their penetration is expected to reach nearly 38 per cent by FY30 and surge beyond 80 per cent by FY40, supported by strong product-market fit for urban commuting, faster innovation cycles, and more favourable total cost of ownership. Electric motorcycles are likely to lag, with penetration estimated at just 5 per cent by FY30 amid persistent concerns over range and upfront costs.

 

“The scooter category has grown faster than others in the past two years. We do think that the share of scooters, both in internal combustion engine and electric, will continue to grow,” Sudarshan Venu, chairman and managing director of TVS Motor Company, said in August last year. The result is an increasingly skewed electrification curve, with scooters emerging as the primary vehicle of the EV transition and consolidating their share of the overall two-wheeler mix.

 

In the near term, however, growth will be driven less by structural change than by cyclical recovery. According to Equirus, a build-up of deferred demand in recent years, as steep price increases, particularly in entry-level motorcycles, outpaced income growth and delayed replacement purchases.

 

Domestic volumes remain about 7 per cent below their FY19 peak of roughly 21 million units, with the shortfall most acute in entry-level motorcycles. This under-recovery has created a pipeline of pent-up demand likely to support growth over the next two to three years.

 

As the replacement cycle gathers pace, part of this demand is expected to shift towards electric vehicles, particularly scooters, where improving ownership economics are narrowing the gap with internal combustion engine (ICE) alternatives.

 

The introduction of more affordable electric models is also expanding the addressable market. With a large share of industry volumes clustered in the ₹85,000–₹1.1 lakh range, EVs priced closer to this band are reducing upfront cost barriers and becoming a viable replacement option.

 

Equirus expects the domestic two-wheeler market to grow at around 6 per cent annually between FY25 and FY30, before moderating as penetration rises and the market matures.