According to a recent ICRA report, the electric segment is likely to account for 14-16% of new three-wheeler sales (excluding rickshaws) by FY2025, up from 8% currently.

Penetration is estimated to rise to 35-40% by FY2030 as the product gains more acceptance, and financing-related challenges subside.

Electric three-wheelers, including e-rickshaws are expected to gain traction going forward due to favourable operating economics and the government's focus on cleaner means of transportation, particularly for commercial applications. According to a recent ICRA report, the electric segment is likely to account for 14-16% of new three-wheeler sales (excluding rickshaws) by FY2025, up from 8% currently. Penetration is estimated to rise to 35-40% by FY2030 as the product gains more acceptance, and financing-related challenges subside.

According to Ms. Kinjal Shah, Vice President & Co Group Head, Corporate Ratings, ICRA Limited, “e3Ws (including e-rickshaws) have been at the forefront of India's electrification journey, being among the early adopters. In 10M FY2023, the 3Ws (excluding rickshaws) recorded an electric penetration of 8%, compared to 4% for two-wheelers and 1% for passenger vehicles. While sales dropped substantially in the aftermath of the pandemic, they rebounded at a healthy rate in the current fiscal year, surpassing pre-pandemic levels by a solid margin. A favourable regulatory environment with central and state government subsidies to lower capital costs, as well as reduction or waiver of registration fees, road taxes, and permit requirements, continues to be supportive of e-auto adoption. Coupled with the inherently lower running costs, this results in a much lower (40-45%) total cost of ownership (TCO) than conventional diesel or CNG 3Ws, making the conversion to e-autos an attractive proposition.”

Until now, the unorganised e-rickshaw industry has dominated the expansion of the e3W market, accounting for 90% of all e3Ws sold in the country. This segment has thrived over the last five-seven years due to lower upfront expenses and operational savings, as well as minimal compliance requirements.