Growing fuel prices are expected to speed up the adoption of electric vehicles (EVs) in India, with industry experts predicting stronger demand across both two-wheelers and passenger vehicles in the coming years.
According to Jay Kale, increasing petrol and diesel prices are likely to encourage more consumers to switch to electric mobility, particularly those who were already considering purchasing EVs, NewsBytes reported.
Kale said the outlook for the electric vehicle sector remains strong, with growth expected in both the two-wheeler and passenger vehicle segments.
He projected that EV penetration in India could rise by approximately 2 to 3 percentage points annually over the next four to five years, reflecting the country’s gradual but accelerating transition towards cleaner transportation.
While acknowledging that rising fuel and vehicle prices can influence consumer purchasing decisions, Kale noted that vehicle ownership costs in India remain relatively attractive compared with the period before the implementation of the Goods and Services Tax (GST). This, he said, should help sustain overall demand in the automotive market despite inflationary pressures.
Looking ahead to FY27, Kale expects both the EV and two-wheeler industries to record growth of around 6 to 8 percent. However, he cautioned that automobile manufacturers are likely to face pressure on profit margins in the near term due to higher raw material costs.
He observed that most automotive companies have reported financial results that were either in line with or slightly above market expectations, although rising input costs are expected to weigh on margins during the current quarter.
Commenting on company performance, Kale expressed confidence in Eicher Motors following its latest earnings announcement. He described the company’s results as steady and highlighted its plans to expand production capacity from 1.4 million units to 2 million units over time.
Despite concerns over inflation and increasing costs across the sector, Kale noted that several automobile manufacturers have already implemented selective price increases to offset higher expenses.
The combination of rising fuel prices, expanding EV infrastructure and growing consumer awareness is expected to further strengthen India’s electric mobility market, positioning EVs as an increasingly attractive alternative for cost-conscious vehicle buyers.
