EV Adoption Continuous To Face Roadblocks In India: Deloitte Report

The ambitious 2030 sustainability targets for electric vehicle (EV) adoption in India appear increasingly difficult to achieve as consumer adoption rates remain sluggish, says a new Deloitte report. The research reveals that affordability concerns and inadequate charging infrastructure continue to be major obstacles for EV market penetration.

The study shows that 54 per cent of Indian consumers still prefer traditional internal combustion engine (ICE) vehicles over electric or hybrid alternatives, as detailed in Deloitte's 2025 Global Automotive Consumer Study for India.

While the government has established an aggressive goal of 30 per cent EV penetration in the passenger vehicle segment by 2030, experts doubt achieving this target for four-wheelers.

"I think, for two-wheelers, it is possible, for three-wheelers we will obviously hit it, but for four-wheelers, it is going to be tough. At just 3 per cent in 2025, we don't have a strong base — achieving 30 per cent in five years is a 10x leap, which is difficult," noted Rajat Mahajan, partner and automotive sector leader at Deloitte India, during a media roundtable, as reported by ET Auto.

Consumer Concerns Limit EV Appeal

Despite government initiatives including subsidies, financing options, and infrastructure development programs, consumer hesitation persists. More than one-third of potential Indian buyers cite high vehicle costs and battery replacement expenses as significant barriers to EV adoption.

Additionally, charging time, insufficient infrastructure, and limited driving range remain primary concerns for consumers contemplating the switch to electric vehicles.

Hybrids Emerging As Transition Solution

The report suggests that hybrid vehicles may offer a more practical transition path toward electrification. Current interest in hybrids (combining HEVs and PHEVs) stands at 33 per cent, with traditional hybrids (HEVs) at 21 per cent and plug-in hybrids (PHEVs) at 12 per cent. Despite various governmental and automotive industry efforts, battery electric vehicles (BEVs) represent only 8 per cent of market interest.

"This is very interesting because we do believe that more and more hybrids are going to become the bridge between ICE and BEV. The future may not necessarily be a complete BEV future as fast as we want it to be. Maybe hybrids are going to play that role," explained Atul Jairaj, partner in Deloitte India's automotive sector.

Limited Hybrid Options And Tax Challenges

India currently offers relatively few hybrid models and maintains a substantial tax differential between electric and hybrid vehicles. While EVs are taxed at just 5 per cent, hybrids face a much higher 48 per cent GST rate. 

The current hybrid lineup in India includes models such as the Maruti Suzuki Grand Vitara, Toyota Urban Cruiser Hyryder, Toyota Innova Hycross, and Toyota Camry.

On a positive note, the study found that while 75 per cent of Indian customers expect to spend less than Rs 25 lakh on their next vehicle, many are willing to pay a premium for electric vehicles -- signaling future growth opportunities for the EV market despite current challenges.