ICRA reports an 11-13% electric bus market share in India by 2025

The IRCA Limited research projects a total electric bus sales share of 11-13% by 2025 and 40% by 2030 in India. PMI Electro Mobility Solutions and Tata Motors are among the leading manufacturers of electric buses in India.

According to the research of Investment Information and Credit Rating Agency (ICRA), electric buses will hold an 11-13% market share in new buses sold by 2025 in India. The electric bus sales in the Indian market have already reached a 7% market share during the first half of 2023.

In 2022, the Indian electric bus market saw a growth of 65% however Reuters reports in late 2022 found reluctance to lend to electric bus manufacturers by Indian banks.

The Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME), has helped a lot in sales of electric vehicles this year. FAME is a government scheme launched to be beneficial for Indian buyers interested in purchasing electric vehicles (EVs). The FAME-II scheme offers an approximate 30-40% reduced cost while buying an electric bus in India.

ICRA believes that a broader penetration of electric buses will happen in India as the bus manufacturing technology is evolving and the bus costs will decrease in future. The low total cost of ownership (TCO) of electric buses will also be an appealing factor in sales growth, the company said.

The Senior Vice President and Co-Group Head of Corporate Ratings at ICRA, Srikumar Krishnamurthy said, “With the government attempting to modernise the fleet with electric buses and total cost of owners works in favour of e-buses, the penetration of the same has been increasing steadily. School bus segment is yet to see the adoption of e-buses. However, the overall penetration will continue to increase going forward.”

PMI Electro Mobility Solutions has delivered 1200 Indian-made electric buses and recently secured an INR 250 crore investment to deliver 2500 more e-buses in India. Tata Motors, one of the leading bus manufacturers in India has a signed agreement to deliver 1500 and 921 electric buses to Delhi Transport Corporation and Bengaluru Metropolitan Transport Corporation respectively.

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The Executive Director at Tata Motors Ltd, Girish Wagh said, “Cumulatively, we have now crossed more than 97 million kilometres and I think in all the contracts we are delivering more than 95% uptime and almost close to 100% uptime towards the end of Q2.”