With over 90% of both conventional and electric 3W sales coming from China and India combined, the market is extremely concentrated.
According to a forecast by the International Energy Agency, sales of electric three-wheelers increased by almost 20% to reach roughly 7 lakh units in 2024, keeping India as the largest market in the world for the second consecutive year.
The Paris-based energy watchdog stated in its worldwide EV Outlook 2025 that India is still leading the way in the expansion of the worldwide market for electric three-wheelers.
Electric 3W sales increased by more than 10% to reach 1 million vehicles in 2024, even as the global three-wheeler market shrank by 5% from the year before. According to the report, sales of electric 3W accounted for about one-fourth of total 3W sales, up from a fifth in 2023.
With over 90% of both conventional and electric 3W sales coming from China and India combined, the market is extremely concentrated.
Over the last three years, China’s 3W electrification rate has remained stagnant at less than 15%. With sales rising by over 20% annually to reach almost 7,00,000 vehicles, India retained its position as the world’s largest market for electric 3Ws after surpassing China in 2023.
In 2024, this resulted in a record 57% electric sales share, a 3% increase over the year before.
It stated that policy support under the new PM E-DRIVE scheme, which allotted funds in 2024 to support the roll-out of over 3,00,000 electric 3Ws for commercial use—the total fleet (electric and ICE) was estimated to be over 10 million vehicles in 2023—looks set to continue this growing trend.
Approximately 80% of global sales in 2024 will come from China, India, and Southeast Asia, according to the IEA, where 2/3Ws are the main form of private passenger transportation.
“India’s increasingly dynamic electric 2W market hosted a total of 220 OEMs in 2024, up from 180 in 2023, although the four market leaders accounted for a combined 80% of the 1.3 million electric 2Ws sold in the country in 2024 (6% of the overall 2W market),” the survey stated.
Although electric 2Ws still typically cost more to buy up front than traditional 2Ws, growing competition is forcing manufacturers to produce more reasonably priced electric variants.
Ola, the market leader in India, for instance, launched the S1X beginning model, which has a 2 kWh battery and a 6 kW peak power, at a sticker price of Rs 70,000, which is less than the average cost of the top five ICE 2W models.
“Policy support is also helping to bridge the affordability gap between electric and ICE 2W models, with the new PM Electric Drive Revolution in Innovative Vehicle Enhancement policy continuing financial support formerly provided under both Faster Adoption and Manufacturing of Electric Vehicles (FAME)-II and Electric Mobility Promotion Scheme measures,” the International Energy Agency (IEA) stated.
With a budget of $1.3 billion, this offers purchase incentives for electric 2Ws (providing purchase subsidies of up to Rs 5,000 per kWh for 2Ws equipped with lithium-ion batteries), as well as for 3Ws and other new EV categories (private cars excluded).
In order to facilitate the roll-out of around 2.5 million electric 2Ws—up from the 1 million targeted under the previous FAME-II policy—the scheme is scheduled to run until March 2026.
In terms of manufacturing, the 80 biggest producers of electric 2Ws in India had a total production capacity of 10 million units in 2024, which was over eight times the amount sold domestically. If all OEM announcements materialise, the capacity is anticipated to rise to 17 million electric 2Ws in the near future.
According to the IEA, total sales of electric cars in India grew by just a small amount, reaching 100,000 (or 2%), in 2024.
In the first quarter of 2025, sales of electric cars in India increased by 45% year over year, approaching 35,000 units.
“In India, the proportion of Chinese imports in EV sales stayed below 15% in 2024 due to high import taxes on EVs and the availability of reasonably priced, domestically produced electric vehicles. The average cost of imported Chinese BEVs was double that of domestically produced models, even though the cheapest battery electric car model was manufactured locally by a Chinese OEM (SAIC’s city car, the MG Comet EV, which costs less than $8,000),” according to the report.
While none of the imported Chinese BEV cars were priced below $20,000 in 2024, all of the battery electric vehicle models produced by Indian automakers began below that amount.
In 2024, the average price difference between ICE and battery-electric vehicles decreased to less than 15% for compact cars and 25% for SUVs.
According to the IEA, the number of electric buses in India has increased rapidly since 2020, rising from fewer than 3,000 to over 11,500 by the end of 2024.