India E-SUV Market Size Analysis Report - Market Share, Forecast Trends and Outlook (2025-2034)

The India E-SUV market is projected to grow at a CAGR of 20.80% between 2025 and 2034, aided by the rising demand for premium electric vehicles equipped with smart technologies and modern interior designs.

India E-SUV Market Growth

In March 2024, the Indian government introduced significant changes to its electric vehicle policy to encourage legacy carmakers to set up manufacturing plants in the country. While 70% import duty was formerly imposed on luxury EV imports, those establishing production facilities in India are allowed to pay a 15% customs duty on vehicles with a minimum CIF (cost, insurance, freight) of $35,000. Moreover, companies investing USD 500 million in India between 2024 and 2027 are mandated to achieve a localisation level of 25% and 50% of domestic value addition within 5 years.

The shift towards sustainability has considerably enhanced the demand for electric vehicles in India, with nearly 70% of consumers in tier-one cities considering an EV for their next automotive purchase. This is substantially higher than the global average of 52%. The shift towards EVs is underpinned by numerous factors, including low ecological impact (67%), lower ownership costs (26%), and reduced noise emissions (26%). Battery electric vehicles have emerged as the main preference for Indian consumers (49%), followed by plug-in hybrid electric vehicles (21%).

Key Trends and Developments

Rising demand for luxury vehicles; integration of ADAS features in e-SUVs; the development of innovative HMI displays; and the growing focus on increasing vehicle range are favourably impacting the India e-SUV market expansion

September 2024

Tata Punch became India’s fastest-selling E-SUV vehicle with sales reaching nearly 400,000 units in August 2024. This prompted the company to introduce an updated version of the same vehicle, featuring a 10.25-inch infotainment system, a fast C-type USB charger, rear AC vents, and a sunroof for a starting ex-showroom price of INR 6.12 Lakh.

September 2024

South Korean automobile manufacturing company, Kia, teased the launch of Kia EV9, a CBU (completely built unit) model offering a 6/7-seater setup and a range of over 365 km. It possesses a wheelbase of 3,100mm and is expected to be priced at INR 1.00 crore upon its launch in October 2024.

June 2024

The Indian New Car Assessment Program (BNCAP), which independently assesses vehicle safety and performance in India, provided a 5-star rating to Tata Nexon.ev and Punch.ev. This makes Tata Motors the only OEM (original equipment manufacturer) which passes the Global NCAP tests for manufacturing the safest range of SUVs.

January 2024

Mahindra & Mahindra Ltd. launched a new range of e-SUVs in India, the XUV400 Pro Range, at a starting price of 15.49 Lakh. It features three new SUV models: EL Pro (34.5 kWh battery, 7.2 kW AC charger), EC Pro (34.5 kWh battery, 3.3 kW AC Charger), and EL Pro (39.4 kWh battery, 7.2 kW AC charger).

Rising Demand for Luxury Vehicles

In 2024, the total investment made by Mercedes Benz in Indian manufacturing plants reached INR 3000 Crore. This can be attributed to the rising preference for locally manufactured luxury vehicles in India.

Integration of ADAS Features in E-SUVs

Advanced driver assistance technology enables vehicles to rely on advanced sensors and cameras to prevent accidental collisions or human errors to enhance pedestrian safety and comply with traffic rules in a better way.

The Development of Innovative HMI Displays

New e-SUV models feature unique human-machine interfaces that provide critical information such as vehicle speed, navigation route, and temperature and weather conditions to the driver, which guarantees a smooth journey.

Focus on increasing vehicle range

The increasing demand for mass e-SUVs presents exciting market opportunities. This includes delivering on consumer expectations of long vehicle range and optimum charging infrastructure along common routes.

India E-SUV Market Trends

During January-June 2024, Mercedes Benz delivered 9262 cars to Indian consumers, recording a year-on-year growth of 9%. The penetration of Mercedes’ electric vehicles in India has nearly doubled from 2.5% of total sales in 2023 to 5% in June 2024. Nearly 55% of all new vehicle sales in this period were SUVs, indicating significant consumer appeal for luxurious vehicles that provide on-road and off-road facilities.

India E-SUV Industry Segmentation

The report titled “India E-SUV Market Report and Forecast 2025-2034” offers a detailed analysis of the market based on the following segments:

Breakup by Type

• Mid-Size
• Full Size
• Compact

Breakup by Propulsion

• Battery Electric Vehicles (BEVs)
• Plug-In Hybrid Electric Vehicles (PHEVs)

Breakup by Drive Type

• FWD
• RWD
• AWD

Breakup by Region

• North India
• East and Central India
• West India
• South India

India E-SUV Market Share

Based on region, the market is segmented into North India, East and Central India, West India, and South India. North India dominated the market, representing 82.1% of the overall market share in 2023. Over the forecast period of 2025-2034, South India is expected to grow at a CAGR of 22.7% as a result of the increasing adoption of electric vehicles.

Leading Companies in the India E-SUV Market

Major market players are expected to establish large-scale manufacturing operations in India to cater to the increasing demand for luxurious and technologically advanced e-SUVs.

Tesla Inc.

Tesla Inc. was founded in 2003 and is based in Texas (USA). It is engaged in manufacturing innovative clean energy products and modern electric vehicles that cater to consumers’ requirements of sustainable transportation.

BMW AG

BMW AG was founded in 1916 and is headquartered in Munich, Germany. It is the world’s leading manufacturer of premium motorcycles and automobiles, with a sales network in over 140 countries. In 2023, the company sold over 2.55 million units of passenger vehicles worldwide.

Volkswagen AG

Volkswagen AG was founded in 1937 and is headquartered in Wolfsburg, Germany. It is the world’s leading manufacturer of electric vehicles equipped with autonomous capabilities and producing reduced noise emissions. The company operates nearly 114 production plants worldwide and sells its vehicles in nearly 153 countries.

Mercedes-Benz Group AG

Mercedes-Benz Group AG is headquartered in Germany and engaged in manufacturing luxurious passenger and commercial vehicles.

Other major market players are BYD Co. Ltd., SAIC Motor Corp. Ltd, AB Volvo, Toyota Motor Corp., Nissan Motor Co. Ltd., and Hyundai Motor Co., among others.