Alternative-fuel vehicles cross 40% share of India’s passenger vehicle market for first time
Economy questions love first ever milestones, and here's a fresh one. Alternative fuel vehicles, that's electric, hybrid and CNG together, crossed a 40 percent share of India's passenger vehicle market for the first time, at 40.35 percent, according to FADA, the Federation of Automobile Dealers Associations. Electric car retail sales hit an all time high of 31,823 units in the month, while petrol vehicles slipped below 44 percent share. What this really means is, India's mobility transition is actually showing up in sales data now. Bottom line for the exam, remember the 40 percent alternative fuel share, FADA data, and record EV sales in 2026.
EV penetration also increased in the two-wheeler and three-wheeler segments, as overall vehicle retail sales rose 22% year-on-year, supported by strong demand and new model launches.
Alternative-fuel vehicles grabbed a record 40.35 per cent share of India’s passenger vehicle (PV) segment for the first time, fuelled by historic electric vehicle sales, data released by the Federation of Automobile Dealers Associations (FADA) on Monday showed. The combined share of compressed natural gas (CNG), hybrid, and electric vehicles crossed the 40 per cent milestone, with passenger EV retail sales hitting an all-time high of 31,823 units.
The market share of petrol and ethanol-powered passenger vehicles slid to 43.63 per cent in June, down from 47.68 per cent during the same period last year. Conversely, CNG-powered vehicles continued their upward trajectory, with their market share climbing to 24.33 per cent last month from 20.82 per cent in June 2025.
Similarly, the share of PV EV registrations has jumped to 7.75 per cent in June, up from 4.80 per cent of the total PV market in June 2025, the FADA research report has indicated. In the Hybrid PV segment, the share has marginally increased to 8.27 per cent in June this year, up from 7.97 per cent in June 2025.
The rise in EV sales over the last year has been helped by fresh launches led by market leaders Tata Motors Passenger Vehicles and Mahindra & Mahindra, followed by JSW MG Motor India and VinFast India. Maruti Suzuki India and Toyota Kirloskar Motor also entered the EV market earlier this year with the e-Vitara and Urban Cruiser Ebella, respectively.
In the electric two-wheelers (e 2Ws) segment too, the share has gone up to 10.60 per cent in June as compared with 7.34 per cent in the corresponding month last year, while the share of Petrol variants has gone down to 89.33 per cent as against 92.44 per cent in June last year.
In the three-wheelers (3Ws) segment too, the share of EVs has gone up to 64.08 per cent in June 2026, as compared with 58.44 per cent in June 2025, while the share of CNG has declined to 22.20 per cent last month, against 29.22 per cent in the same month the previous year.
Meanwhile, in overall vehicle retail sales across segments, FADA reported a 22 per cent year-on-year (YoY) growth to 25,57,234 units in June, as against 20,98,996 units in June last year.
PV registrations grew by 28.63 per cent YoY to more than 4.10 lakh units in June, up from more than 3.19 lakh units in June 2025. Total two-wheeler registrations grew by 21.22 per cent YoY to around 18.28 lakh units during the month, as compared with around 15.08 lakh units in June last year.
Going forward, the dealers said retail sales in the near term rest on the monsoon making up its deficit, Kharif sowing gathering pace and supplies staying normalised following the West Asia ceasefire and easing crude prices.
“Two-Wheelers should benefit from the rural income cycle once sowing is complete, PVs from the festive build-up beginning with Ganesh Chaturthi and Onam in September, and CVs from sustained goods movement and infrastructure activity,” C S Vigneshwar, President, FADA, said.
Having said that, he also added that dealers identified a monsoon shortfall/El Niño impact on rural demand as the single biggest risk, followed by further price hikes that would affect affordability and pressure inventory levels.