Tata, JBM & Switch Mobility Hold 88% of India’s E-Bus Market

Electric buses currently account for 4% of India’s annual bus registrations, with 3,644 units sold in FY24, reflecting an 81% year-on-year growth. The transition to cleaner fuels has decreased conventional diesel and petrol buses’ market share from 97-98% a decade ago to 90% in FY24, said CareEdge Ratings. It also predicts the electric bus adoption to reach 15% by FY27.

Sizeable e-Bus Manufacturing Capabilities

The CareEdge report found that the Indian e-bus industry is dominated by a few players, including Tata Motors, Olectra, JBM, PMI, and Switch Mobility, which held 88% of the market share in FY24. These companies collectively can manufacture 40,500 e-buses p.a. Demand growth is further supported by a robust order book among industry players. These companies had an order book of approximately 20,000 electric buses as of September 30, 2024, set to be delivered within the next 1-2 years.

Faced with air pollution and traffic congestion, e-buses offer a way to reduce emissions. There is an untapped potential of e-buses due to the rising demand for sustainable public transport.  As of Cyclic Year (CY24), Maharashtra leads in electric bus registrations with 2,423, followed by Delhi at 2,361 and Karnataka at 1,473. More State Transport Undertakings (STUs) are now issuing tenders for e-buses under the Gross Cost Contract (GCC)  model, increasing e-bus penetration nationwide.

Currently, EV adoption in India stands at 4% but is expected to grow due to cost reductions, better-charging infrastructure, and supportive policies. India has significant e-bus potential, with only six electric buses per million people, compared to the global average of 85 people.

Strong policy push from the Government by way of PM e-Bus Seva and PM e-Drive, the annual sales volume of e-Buses in the country is expected to reach more than 17,000 units in FY27 which would be nearly 15% of the total bus sales volume in the country vis-à-vis 4% in FY24.

CareEdge Ratings’ View 

“The required ecosystem for e-buses has broadly developed in the country. With that, the sales volume of e-buses is envisaged to reach more than 17,000 units in FY27, increasing penetration rates to around 15%,” said Arti Roy, Associate Director at CareEdge Ratings.

“E-bus adoption in the country till now has been largely limited to STUs and intra-city transportation. However, with TCO clearly in favour of e-buses, private bus operators are also expected to go in for e-buses which would significantly fast-track e-bus adoption in the country. E-bus penetration in inter-city transportation, which has a huge potential, would require improved charging infrastructure with fast charging facilities.”

Hardik Shah, Director at CareEdge Ratings, said, “Also, GCC model has excellent prospects but lingering concerns of bus operators with respect to timely payment by STUs need to be properly addressed through an adequate payment security mechanism. Further, the ability of OEMs to bid for many E-bus tenders would be limited as it is an asset-heavy business model for them. Consequently, emergence of innovative business models are expected shortly, which could sustain improvement in the share of e-buses in the country” he added.