EV Price Trends in 2024 in India: What to Expect

Published on 18 May, 2023, 12:30 PM IST
Updated on 29 Jan, 2024, 9:34 AM IST

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India has set an ambitious target of having 30% electric vehicles (EVs) on roads by 2030 in a bid to reduce its carbon footprint and dependence on imported oil. To achieve this target, the government has announced various incentives and policies to encourage the adoption of EVs, including GST reduction on EVs, income tax exemption on loans for EVs, and the establishment of charging infrastructure across the country. 

As a result, the Indian EV market has been growing steadily, with sales of EVs reaching 10.54 lakh units in 2022, a 206% growth from the previous year. In this article, we will examine the EV price trends in India in 2023 based on current market conditions and government policies.

ev-price-trends-2023-india

Factors Affecting EV Prices in India

Before we delve into the price trends, it is important to understand the factors that affect the prices of EVs in India. Here are more details on the same.

  • Battery Cost: The cost of batteries is a major factor that determines the price of an EV. Battery prices have been decreasing steadily over the years. The same trend may continue in the future, making EVs more affordable.

  • Government Incentives: The Indian government has announced various incentives and policies to encourage the adoption of EVs, including a 5% GST on EVs, income tax exemption on loans for EVs, and the establishment of charging infrastructure across the country. These incentives can significantly reduce the price of EVs.

  • Economies of Scale: As the demand for EVs increases, the production of EVs will increase, leading to economies of scale. This can help reduce the cost of production, making EVs more affordable.

  • Technology: The advancements in technology can also affect the price of EVs. Newer and more advanced technologies can increase the cost of EVs, while older and more established technologies can reduce the cost of EVs.

Based on the above factors, we can expect the following price trends for EVs in India in 2024:

  • Reduction in Battery Costs: The cost of batteries may further go down in 2023, making EVs more affordable. Further, the cost of batteries could be significantly lower in 2030 compared to 2023. It may result in making EVs cheaper than petrol and diesel cars.

  • Increase in Demand: The demand for EVs is likely to increase in 2023 as more people become aware of the benefits of EVs and the government continues to announce incentives and policies to encourage their adoption. This increase in demand can lead to economies of scale, which can help reduce the cost of production, making EVs more affordable.

  • Expansion of Charging Infrastructure: The Indian government has announced plans to set up charging infrastructure across the country, which can help increase the adoption of EVs. This can also help reduce the range anxiety associated with EVs, which can further increase their demand.

  • New Entrants: Several new EV manufacturers are expected to enter the Indian market in 2023, which can increase competition and lead to price reductions. Some of the new entrants include Tesla, MG Motors, and Nissan.

  • Increase in GST: The GST reduction on EVs is currently at 5%, but there is a possibility that it may go up in the future. This can increase the price of EVs, making them less affordable.

To give an idea of the expected prices of popular EV models in 2024, we have compiled a table based on the current prices and expected price trends.

Model Current Price (in Rs.) Expected Price in 2023 (in Rs.)
Tata Nexon EV Max 16 lakhs 14.50 lakhs
MG ZS EV 23 lakhs 19.50 lakhs
Hyundai Kona Electric 23.85 lakhs 21.50 lakhs
Ather 450X 1 lakh 85,000

*Note: The above-expected prices are based on the assumption of a reduction in battery costs, an increase in demand, and economies of scale. The prices mentioned above are approximate ex-showroom prices across the country for the entry-level variant.

The Indian EV market is poised for growth, and the government's policies and incentives can accelerate the adoption of EVs in the country. The reduction in battery costs, the expansion of charging infrastructure, and the entry of new players in the market are expected to make EVs more affordable and accessible to the masses. 

However, it is important to note that the expected price trends are based on assumptions and can change depending on various factors such as government policies, technology advancements, and global market conditions.

Overall, the future of EVs in India looks bright, and the shift towards a cleaner and more sustainable mode of transportation is inevitable. With the right policies and initiatives in place, India has the potential to become a global leader in the EV space and contribute significantly towards a greener future.

Frequently Asked Questions (FAQs)

Here are a few frequently asked questions and their answers related to EV price trends in 2024 in India.

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Will the prices of EVs be lower than petrol and diesel cars in 2024?

The cost of batteries is expected to decrease significantly by 2024, making EVs cheaper than petrol and diesel cars. However, in 2024, the prices of EVs may still be higher than petrol and diesel cars, but the difference is expected to reduce.

Will the Indian government continue to provide incentives for EVs?

The Indian government has set a target of having 30% electric vehicles on its roads by 2030 and has announced various policies and incentives to achieve this goal. It is expected that the government will continue to provide incentives for EVs in the future to accelerate their adoption.

Will the increase in demand for EVs lead to price reductions?

As the demand for EVs increases, the production of EVs will increase, leading to economies of scale. This can help reduce the cost of production, making EVs more affordable. Therefore, an increase in demand can lead to price reductions.

Will the entry of new players in the market reduce the prices of EVs?

The entry of new players in the market can increase competition, which can lead to price reductions. New players may offer innovative and cost-effective solutions that can drive the prices down.

Will the increase in GST affect the prices of EVs?

Currently, the GST reduction on EVs is at 5%, but there is a possibility that it may be increased in the future. If the GST goes up, it can increase the price of EVs, making them less affordable.

Will the expansion of charging infrastructure lead to an increase in EV adoption?

The expansion of charging infrastructure can help reduce the range anxiety associated with EVs, which can further increase their demand. Therefore, the expansion of charging infrastructure can lead to an increase in EV adoption.

Disclaimer: The above content is for informational purposes only. It is recommended to take the help of an expert before making a decision.

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