India's car market is seeing rapid adoption of alternative fuels, with compressed natural gas (CNG) vehicles leading the way, followed closely by hybrids, while electric vehicles (EVs) continue to face challenges in mass adoption despite a growing global focus on the EV sector, reports the Economic Times.
Between January and August 2024, sales of CNG cars in India surged by 46% year-on-year, according to data from Jato Dynamics cited by ET. Hybrids posted a respectable 19% growth, while EVs lagged behind, growing by only 7%. Overall car sales in the country rose by 6% to 2.87 million units in the same period. The launch of new vehicles further reflected this trend, with the majority of the new offerings being CNG models, followed by hybrids and electric vehicles.
Carmakers are adjusting their strategies to stimulate demand in the EV segment, the ET report added. Tata Motors and MG Motor have slashed prices and introduced more financing options, battery-as-a-service models, and free charging incentives. However, these efforts have yet to result in widespread EV adoption, which experts attribute to infrastructure limitations and high initial acquisition costs.
Union Minister Nitin Gadkari, while noting that EV prices have become competitive, recently suggested that consumers should consider other clean fuel alternatives in addition to EVs. This indicates a broader governmental strategy to promote a variety of alternative fuel vehicles rather than focusing exclusively on electric ones.
CNG’s growth is also being driven by its popularity among gig workers and small businesses, which prefer this fuel for its cost efficiency. Maruti Suzuki sold 48,000 CNG cars in August alone and is targeting over 600,000 CNG sales by the end of the fiscal year. “We are aiming to sell 50,000 S-CNG cars per month with the launch of the Swift S-CNG,” Partho Banerjee, Senior Executive Director at Maruti Suzuki, stated.
Meanwhile, hybrid cars continue to attract customers interested in a balance between fuel efficiency and lower emissions. Toyota, for instance, has introduced models like the Rumion and Urban Cruiser Taisor to cater to this demand.
Despite the EV market's slow growth, automakers remain optimistic. MG Motor, for example, recently launched its third electric vehicle, the Windsor crossover, as part of a broader effort to lower the acquisition cost for consumers through a battery rental model, aiming for a 50% market share in the EV segment.
This diverse landscape of vehicle options highlights a shift in consumer preferences, with multiple fuel technologies competing for dominance as India navigates its clean energy transition.
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