EV trajectory: Electric car sales may cross 7% penetration by FY28, says CareEdge report; hinges on rare earth supply, infrastructure

Electric car sales in India are projected to cross 7% of total car sales by FY28, provided supply chain disruptions in rare earth elements (REEs) are resolved in a timely manner, according to a report by CareEdge Advisory. The projection is backed by an accelerating pipeline of new model launches, expanding charging infrastructure, and battery localisation efforts under the government’s production-linked incentive (PLI) scheme.“India’s electric car sales penetration is likely to cross 7 per cent by FY28, provided rare earth disruption is resolved in a timely manner. With a robust pipeline of model launches, expanding EV charging infrastructure and battery localisation under the PLI scheme, India is well-positioned to accelerate EV adoption,” said Tanvi Shah, Senior Director & Head, CareEdge Advisory & Research, PTI quoted.The report notes that the electric car ecosystem in India has grown rapidly in the past three years — from just over 5,000 units in FY21 to more than 1.07 lakh units in FY25. While electric two- and three-wheelers continue to dominate EV sales in volume, the four-wheeler segment is entering a high-growth phase, supported by favourable policy and strong private sector investment.Charging infrastructure — one of the main bottlenecks in EV adoption — is now seeing strong momentum. The number of public EV charging stations in India rose from 5,151 in CY22 to over 26,000 by early FY25.Further policy support under FAME III, exemptions in basic customs duty for battery-critical minerals such as cobalt and lithium-ion waste, and the ACC PLI scheme are expected to reduce vehicle costs and enhance domestic battery production capabilities.CareEdge believes these developments will be instrumental in placing India firmly on the path of sustained EV adoption over the coming years.