India E-Scooter Market Outlook to 2030

India E-Scooter Market Overview

• The India E-Scooter market reached a market size of USD 1 bn in 2023, driven by increasing consumer demand for affordable, eco-friendly transportation solutions. Rising fuel prices and government incentives for electric vehicles have accelerated the adoption of e-scooters. Additionally, the expansion of charging infrastructure has contributed to the growth of this sector. These factors have boosted market penetration in urban and semi-urban regions.
• The key players dominating the India E-Scooter market include Ola Electric, Hero Electric, Ather Energy, Bajaj Auto, and TVS Motor Company. These companies have invested in technology innovation, battery advancements, and after-sales service infrastructure. Ola Electric, for instance, has recently expanded its product portfolio and aims to produce over 10 million electric scooters annually by 2024, positioning itself as a market leader.
• In March 2024, Hero Electric announced a partnership with BPCL to establish 1,000 electric vehicle charging stations across India. This strategic development aims to strengthen the charging infrastructure, enhancing convenience for e-scooter users and addressing range anxiety. This move is set to accelerate the adoption of e-scooters, further boosting market penetration in metro cities.
• In 2023, the Indian government revised the FAME II (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) scheme, extending incentives for electric two-wheelers. The scheme provides INR 10,000 subsidy per kilowatt-hour of battery capacity for e-scooters, which is expected to spur sales across major cities. Moreover, the budget allocation for the scheme has increased in 2024 to support infrastructure.
• Delhi, Bengaluru, and Pune are among the dominant cities in the e-scooter market due to their focus on sustainable urban mobility, high pollution levels, and government incentives. These cities have also seen better infrastructure for charging points, making them favorable for electric vehicle adoption. Delhi's EV policy, for instance, provides zero road tax and significant subsidies, propelling e-scooter sales in the city

India E-Scooter Market Segmentation

• By Battery Type: The India E-Scooter market is segmented by battery type into Lithium-ion batteries and Lead-acid batteries. In 2023, Lithium-ion batteries dominated the market share due to their longer life cycle, faster charging time, and higher energy density. The dominance of lithium-ion batteries is reinforced by their affordability, enhanced efficiency, and decreased overall weight of the scooters, making them the preferred choice among manufacturers and consumers alike.

• By Vehicle Class: Indias E-Scooter market is segmented by vehicle class into Low-Speed E-Scooters and High-Speed E-Scooters. In 2023, High-Speed E-Scooter had a dominant market share due to increasing consumer demand for faster commute options with longer range. These e-scooters offer speeds above 45 km/h and are preferred in metro cities where daily commutes cover longer distances. High-speed e-scooters also benefit from better subsidy schemes under the FAME II initiative, which has improved their affordability.

• By Region: Regionally, the India E-Scooter market is segmented into North, South, East, and West. In 2023, Southern region dominated the market share, primarily driven by high consumer awareness and government initiatives supporting electric mobility. Cities like Bengaluru and Chennai have well-developed charging infrastructure and favorable weather conditions for year-round scooter usage. Additionally, subsidies and local manufacturers in these regions have encouraged more consumers to shift to electric scooters.

India E-Scooter Market Competitive Landscape

• Ola Electric's Recent Development: In February 2024, Ola Electric announced the expansion of its manufacturing facility in Tamil Nadu, increasing its production capacity to 20 million e-scooters annually by 2025. This development is part of its strategy to meet rising domestic demand and export requirements. The company also unveiled new battery technologies aimed at enhancing performance and reducing charging time.
• Ather Energys Recent Development: Ather Energy introduced a new model, the Ather 450X Gen 4, in January 2023, which features a longer range of up to 150 km on a single charge. This has positioned the company as a key player in the premium segment of e-scooters, catering to consumers seeking high-performance electric vehicles. The company has also set up 100 fast-charging stations in various cities, improving accessibility.

Growth Drivers

• Government Subsidies and Incentives: Government support has been a key driver for the growth of the India E-Scooter market. Under the FAME II scheme, subsidies of up to INR 10,000 per kWh of battery capacity are being provided to consumers purchasing electric two-wheelers. This financial aid, coupled with tax exemptions, has significantly reduced the overall cost of e-scooters, making them a preferred choice among consumers. As per the Ministry of Heavy Industries, the FAME II scheme has already benefitted over 300,000 e-scooter users by 2024.
• Rising Fuel Prices and Cost Efficiency: With fuel prices continuing to rise, consumers are increasingly opting for electric scooters as a cost-efficient alternative. The operational cost of an e-scooter is approximately INR 0.15 per km, significantly lower than the INR 2.5 per km for petrol scooters. This stark difference has shifted consumer behavior, especially in urban centers where daily commuting distances are long. Data from the Petroleum Planning & Analysis Cell (PPAC) indicates that fuel prices increased by over 7% in 2023, further driving this shift.
• Expansion of Charging Infrastructure: The growth of charging infrastructure has been instrumental in propelling the e-scooter market. Cities like Delhi, Bengaluru, and Hyderabad have seen a 40% increase in public charging stations in 2023 alone. According to a report from the Ministry of Power, the number of charging stations nationwide is expected to grow by 20% annually until 2025.

Challenges

• Battery Disposal and Recycling Concerns: The environmental challenge of battery disposal is becoming more significant as e-scooter sales increase. Lithium-ion batteries, commonly used in e-scooters, are difficult to recycle and pose a long-term environmental hazard if not properly disposed of. India currently lacks a robust infrastructure for recycling these batteries.
• Limited Range and Charging Time: Despite improvements in battery technology, range and charging times remain challenges for the Indian market. Most e-scooters offer a range of 80-100 km per charge, which is often insufficient for long commutes. In addition, full charging times can still take up to 6 hours. The inconvenience of long charging times hinders mass adoption, particularly in regions without access to fast chargers.

Government Initiatives

• FAME II Scheme Extension (2023): The government has extended the FAME II scheme until 2024 to further accelerate the adoption of electric vehicles. Under this initiative, the government is offering subsidies to manufacturers to lower the production cost of e-scooters. According to the Ministry of Heavy Industries, this extension aims to achieve a target of 1 million electric two-wheelers on the road by the end of 2024, boosting the market significantly.
• Battery Swapping Policy: In 2022, the Indian government introduced a draft policy for battery swapping, aimed at addressing concerns about charging times and range anxiety. The policy encourages the creation of standardized, swappable batteries to enable quick battery exchanges at designated stations. The Ministry of Power estimates that by 2025, 10% of e-scooters on the road will utilize battery swapping technology, significantly reducing wait times for recharging.

India E-scooter Market Future Outlook

The India e-scooter market is expected to witness robust growth, driven by rising environmental concerns, government initiatives promoting electric vehicles, and increasing fuel prices. Expanding charging infrastructure and advancements in battery technology will further support market expansion. India is poised to become one of the leading e-scooter markets globally, with significant domestic and international investments.

Future Trends (Market Outlook to 2028)

• Advancements in battery swapping technology: By 2028, battery swapping technology will dominate the India E-Scooter market, as the government continues to support infrastructure development for battery exchange stations. The Ministry of Power projects that 20% of all electric two-wheelers will utilize battery swapping by 2028, reducing charging time and increasing convenience for users. This shift will make e-scooters more viable for long-distance travel, particularly in metro cities. Source: Ministry of Power, India.
• Expansion of fast charging networks: Over the next five years, the expansion of fast-charging networks will significantly alter the e-scooter landscape. By 2028, it is expected that fast-charging stations will be available on all major highways, reducing the average charging time to less than 30 minutes. The Ministry of Transport plans to deploy over 50,000 fast chargers by 2028, ensuring seamless travel across the country. This will likely increase the adoption of high-speed e-scooters for longer commutes.

India E-Scooter Market Future Outlook

The India E-Scooter market is projected to witness significant growth, driven by government support, expansion of battery swapping and fast-charging infrastructure, and increasing consumer preference for connected, IoT-enabled vehicles. Enhanced performance, cost-efficiency, and eco-friendly transportation solutions will propel the market, making e-scooters a dominant choice in both urban and semi-urban regions.