How Is High Component Replacement Rate Steering India Electric Vehicle Component Market Growth?

Growth drivers such as the booming sales of electric vehicles (EVs) and declining prices of their components will fuel the Indian EV component market at a CAGR of 22.1% during the forecast period (2020–2030). According to P&S Intelligence, the market generated revenue of $536.1 million in 2019. Currently, the rising popularity of high-battery capacity EVs, owing to their ability to cover long distances in a single charge, has become a prominent market trend.

One of the primary growth drivers of the Indian EV component market is the burgeoning sales of EVs, owing to the extensive government support, in the country. According to the Society of Manufacturers of Electric Vehicles (SMEV), 155,400 EVs were sold in India during the financial year 2019–2020. In 2019, 2,000 electric passenger cars and 32.4 thousand electric two-wheelers were sold in India. In the coming years, government initiatives such as the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME India) scheme will boost the sales figure of EVs in the country.

Geographically, Uttar Pradesh held the largest share in the Indian EV component market during the historical period (2014–2019), due to the highest replacement and procurement rate of several components of electric two- and three-wheelers in the state. Whereas, Tripura is projected to exhibit the fastest growth during the forecast period, primarily on account of the mounting number of e-rickshaws in the state. Various OEMs and aftermarket companies will be offering a large volume of components of electric three-wheelers in this state in the coming years.

Thus, the mushrooming demand for EVs and rising replacement and procurement rate of EV components will fuel the prosperity of the market in the coming years.