India’s passenger vehicle market is showing a significant shift in consumer preferences, with CNG, hybrid and electric vehicles collectively overtaking petrol-powered cars in retail sales for the first
time in August, according to data from the Federation of Automobile Dealers Associations (FADA).
Alternative powertrains accounted for 41.9% of passenger vehicle retail sales in August, slightly ahead of petrol’s 40.8% share. CNG was the biggest contributor among alternative fuels, accounting for 25.2% of sales, followed by hybrid vehicles at 9% and electric vehicles at 7.6%. Diesel vehicles accounted for 17.2% of passenger vehicle retail sales.
The shift marks a notable change from a year ago, when petrol’s share was nearly 11 percentage points higher than the combined share of the alternative-fuel segment.
CNG Leads Alternative-Fuel Shift
The transition is being driven by multiple technologies rather than a single alternative to petrol. CNG has emerged as the most popular option, helped by its lower running costs. Hybrids are attracting buyers looking for improved fuel efficiency without relying on charging infrastructure, while electric vehicles continue to gain ground.
FADA said running-cost economics and continued concerns around the transition to E20 fuel were among the factors pushing consumers towards CNG, hybrids and EVs. Petrol, however, remains the largest individual fuel category.
Among manufacturers, Maruti Suzuki dominated the CNG passenger vehicle segment with around 71% share, while Tata Motors led the electric passenger vehicle market with around 43% share.
EV Adoption Rises Across Vehicle Categories
The shift towards alternative powertrains is also becoming increasingly visible in two-wheelers and commercial vehicles.
Electric two-wheelers accounted for 10.7% of retail sales in August, up from 7.7% a year earlier. The penetration crossed the 10% mark in a non-festive month for the first time, indicating that electric scooters are increasingly moving beyond early adopters and into the mainstream commuter market.
Three-wheelers have moved even further towards electrification. EVs accounted for 65.3% of three-wheeler sales in August, compared with 56.6% a year earlier, making the segment increasingly dominated by electric vehicles.
Commercial vehicles, meanwhile, are beginning to see a similar shift from a much smaller base. EVs accounted for 5.2% of commercial vehicle sales in August, more than double the 2.1% share recorded a year earlier and the highest level recorded so far.
Across all vehicle categories, electric vehicle retail sales stood at 2.98 lakh units in August, registering a 52.9% year-on-year increase.
