EV makers charge up for festive season demand with focus on tier II and III cities

Traditionally, October to November period delivers a 20–30 percent jump in two-wheeler sales (AI generated image)

Electric two-wheeler and three-wheeler makers are gearing up for a high-stakes festive season, banking on new launches, innovative financing and rising demand from tier II and III towns to drive adoption.

Traditionally, October to November period delivers a 20–30 percent jump in two-wheeler sales, and manufacturers such as Ola Electric, Ather Energy, TVS, Bajaj Auto as well as players like Zelo Electric, Bounce and Alt Mobility are treating this period as a critical window to expand adoption beyond metro markets.

In October 2024, festive buying had triggered a sharp 54 percent month-on-month surge in E2W registrations to 1,39,022 units, according to Vahan dashboard data.

With the GST Council’s decision to keep EVs in the 5 percent slab, industry executives say structural tailwinds this year are stronger.

Ola, Ather lead festive charge

Ola Electric recently announced the expansion of its S1 scooter lineup, including refreshed variants with improved battery efficiency, alongside new offers such as zero down payment schemes and bundled extended warranties.

The company has also scaled up its retail network, aiming to deepen presence in non-metro cities, which it identifies as its next growth frontier.

Ather Energy, meanwhile, has unveiled a slew of features at its annual Community Day event. The company is betting big on its new product Ather Rizta, a family scooter designed with larger boot space, improved comfort features.

The company also announced festive financing partnerships to make upfront costs easier for customers.

These launches underline a larger shift, instead of heavy discounting, OEMs are focusing on tailored products, financing innovation, and regional retail expansion to win over cost-conscious buyers in smaller cities.

Affordability through financing

Dev Arora, founder and CEO at Alt Mobility, said the festive season marks a move toward sustainable demand creation.

“The GST 2.0 rationalization is a welcome move, not only for reducing the cost differential between ICE and EVs but also giving OEMs room to innovate with pricing and financing options. Traditionally, upfront cost had been the biggest barrier in smaller towns, but dynamic leasing models, longer tenures, and zero-down payment financing are unlocking affordability for a much wider consumer base,” he said.

Arora added that OEMs and financiers are investing in local distribution and retail networks, partnering with regional dealers, and tailoring offerings to smaller-city consumers who value trust, service reliability, and cost predictability.

Zelo Electric, which recently launched the Knight+, is betting on the festive season to accelerate growth.

“Since the recent launch of Zelo Knight+, we are witnessing increased demand, expecting a 20–25 percent increase particularly as we approach the festive season. Most Indians prefer buying vehicles during festivals considering it auspicious, and with expanding charging infrastructure and aggressive market penetration strategies,

Push for Tier II and III cities

Tier II and III cities are now driving significant EV sales growth,” said Aditya Baheti, co-founder of ZELO Electric.

A JMK Research & Analytics white paper validates this trend, noting EV penetration of 10.67 percent in Tier II and 8.68 percent in Tier III cities in 2025.

Baheti said financial tie-ups are helping bridge affordability concerns.

“We support customers with strategic NBFC partnerships and flexible loan arrangements, combined with favorable GST, accelerating EV adoption beyond metros. We recently partnered with Bajaj Finserv to boost adoption with financial ease.”

"Our platform will launch exclusive festival offers, including generous discounts, exchange programs, and customer‑first referral benefits to make electric mobility more accessible and rewarding,” Neeraj Manchanda, founder, Zuge Electric.

“Ahead of festivities like Navratri and Diwali, we’re expanding our network, adding new sales and service touchpoints, especially in Tier‑II and Tier‑III cities, to ensure that buyers everywhere can easily experience, purchase, and maintain EVs. Simultaneously, we’ll enhance our digital channels with seamless online booking, same‑day delivery options, and enhanced support systems to deliver a worry‑free, premium customer experience.” Manchanda added.

B2B demand adds momentum

Bounce EV, which caters to both retail and institutional buyers, expects festive demand to spill into the B2B segment.

“In terms of festive sales, we will see an uptick, especially in the B2B segment. Tier II and III towns have been a huge opportunity and we will see more players penetrating,” said Vivekanand Hallekere, founder of Bounce EV.

Financiers step up with offers

New-age financiers are also readying schemes to support demand this season.

“Festive season is important for EV makers, but even from a financier’s perspective we will see many offers being rolled out, from low-cost EMI options to zero down-payment schemes, longer repayment tenures, and bundled insurance packages,” said Xitij Kothi, founder of Vidyut Tech, an EV financing platform.

“These interventions matter more in smaller towns, where buyers are aspirational but sensitive to upfront costs.”

Industry executives say the combination of festive sentiment, favorable GST, and financing innovations will ensure that this year’s sales momentum extends beyond just October–November.

“Last October’s 54 percent surge showed us the market’s appetite. With GST benefits and new-age financing models in play, I believe this festive push won’t just be a temporary spike but a structural shift. Even as subsidies taper, models like dynamic leasing and battery-as-a-service will ensure steady growth in India’s heartland,” Arora added.

ICE Challenge

While the tailwinds are plenty, the recent GST cut on internal combustion engine (ICE) vehicles, from 28 percent to 18 percent, poses a potential headwind for electric two-wheeler adoption, as it narrows the upfront price gap with petrol scooters.

However, industry executives point out that the rationalization has also lowered input costs for EV manufacturers. Over time, this could support faster progress toward total cost of ownership (TCO) parity between electric and ICE two-wheelers, a key factor in driving mass adoption.