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EV sales soar in the first half of FY2026 but fall in the final month of the period as ICE and hybrid vehicles get cheaper
India looks on track to record at least 20 lakh in EV sales this financial year, just like in the previous one. More than 10 lakh electric vehicles have already been sold in the first half, as per a report from The Times of India, based on data from the Vahan portal.
Across categories, 11 lakh EVs were sold in India between April 2025 and September 2025. Compared to the first half of FY2025 (8.95 lakh units), EV sales grew by 2.05 lakh units or 22.9%. Should the momentum continue through the second half, FY2026 may not just meet but exceed the FY2025 volume, which, as per a report from Autocar Professional, was 19.7 lakh units.
The recent GST reductions on ICE and hybrid vehicles do not work in favour of EVs and may impact their sales to an extent, though, especially in the case of cars. While EVs continue to be taxed at the lowest rate – 5%, ICE and hybrid models now attract as low as 18% GST. This means the minimum gap has reduced from 23% to just 13%, in the case of both cars and two-wheelers.
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September 2025 sales may have already shown early signs of a potential slowdown in certain EV segments. 1.82 lakh EVs were sold last month, and compared to 1.88 lakh units from August 2025, it was just a small decline of 3.3%. However, among cars, specifically, sales dropped from 18,290 units in August 2025 to 15,100 units last month, down 17.4%.
S&P Global Mobility Director Puneet Gupta said the GST revisions have reduced EV penetration in the car segment from close to 5% to approximately 4%. Crisil Ratings Director Poonam Upadyay said that consumers in this segment are highly price-sensitive.
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In the case of two-wheelers, though, the GST rate seems to have had virtually no effect on the sale of electric models. 1.04 lakh electric two-wheelers were sold in September 2025, just 1,000 units less than in August 2025 (1,05 lakh units). As for electric three-wheelers, 61,000 units were sold in September 2025, 2,500 units less than in the preceding month (53,500 units).
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