India To Be World's 4th Largest EV Maker By 2030
A majority of the nations across the globe are targeting to become electric vehicle manufacturing hubs. Of these, India has been reported to become the fourth-largest electric vehicle manufacturer by 2030. It will follow the lead of China, Europe, and the United States of America. It has been estimated that the production of electric vehicles will reach a capacity of 2.5 million (25 lakh) electric four-wheelers in India, from 0.2 million (2 lakh) in 2024.
India will produce more EVs than it will have demand
According to recent reports, the demand for electric vehicles in India will be far behind the manufacturing capability it will have. It is believed that India will have a demand of 4 lakh to 14 lakh units of electric vehicles by 2030. This means that there will be a surplus of 11–21 lakh units of EVs, which will then be exported to other countries.
Currently, the three major electric automakers in India are Tata Motors, Mahindra Automotive, and MG Motor. Combined, these carmakers have a 90 percent market share. Unfortunately, despite this dominance, these automakers have only managed to penetrate 2 percent of the Indian automotive market.
When compared to other global markets, this displays a very slow EV penetration and growth. Vietnam’s electric vehicle market, for example, has grown by 17 percent within two years, from 2022 to 2024. The country's own EV manufacturing giant, VinFast, has been a major player in increasing EV penetration in Vietnam.
Estimated forecast of electric vehicles manufacturing
As per the forecasts, by 2030, China will be producing around 2.9 crore electric cars. It will be followed by the European Union producing 90 lakh units. Then there will be the United States with around 60 lakh units. As for India, it is expected to make around 25 lakh units, followed by South Korea and Japan producing 19 lakh and 14 lakh units of electric vehicles, respectively.
India's EV manufacturing growth
By 2030, India will rise in the rankings due to the aggressive expansion of EV plants. Currently, 13 lakh units’ worth of capacity in India is under construction. Additionally, 7 lakh units have been announced. Also, 3 lakh units are ready but not yet operational.
This EV push will help India to overtake Japan and South Korea, both of whom have limited new capacity announced despite currently higher operational output. Experts have highlighted that India is positioned as the top EV manufacturing hub among emerging economies outside of the traditional EV leaders.
Manufacturing vs. Demand Gap
In 2024, the electric manufacturing capacity of India stood at 2 lakh units. However, the demand for electric vehicles in India was around 1 lakh units. Now, with the new 2030 forecast, this manufacturing capacity will be bumped up to 25 lakh units; meanwhile, the estimated demand range will be around 4–14 lakh units.
This will then lead to a massive gap of 11–21 lakh units. However, the flip side will be that these additional units will present an opportunity to become a massive EV exporter. The exports, however, will depend upon the competitiveness of Indian-made EVs globally.
In the international markets, quality standards are the name of the game, so producing low-quality EVs will not help India in becoming a big exporter. However, if automakers can make sure that their vehicles are made up to global standards, then they will be able to dominate internationally as well. Also, logistics infrastructure for global distribution will play an important role, and so will the bilateral trade agreements with EV-importing nations.