CNG, hybrid and electric vehicles overtake petrol as Indian car buyers embrace cleaner fuels | Today’s news

The Indian passenger vehicle market is witnessing a significant shift as consumers rapidly shift to cleaner fuel options. A report from Equirus Securities pointed out that CNG, hybrid and electric vehicles accounted for 42 percent of retail passenger vehicle sales in August, overtaking gasoline-powered vehicles for the first time.

According to the report, retail sales of passenger vehicles (PVs) grew by 26 percent year-on-year in August, supported by better affordability following the cut in GST rates.

“Gasoline’s share fell to a record low of 41 percent, while CNG rose to a record 25 percent, bringing the combined share of CNG, hybrids and EVs to 42 percent — ahead of gasoline for the first time,” he noted.

The changing fuel mix comes as overall demand for passenger vehicles remained strong, with retail sales up 16 percent year-on-year in August 2026. The growth was supported by improved affordability of vehicles following the recent cut in GST rates, the report said.

The passenger vehicle fuel mix continued to move away from gasoline in August 2026. The share of gasoline fell to a record low of 41 percent, down from 46 percent a year earlier. The share of CNG, on the other hand, rose to 25 percent from 21 percent.

Sales of electric cars in August also jumped by 52 percent year-on-year to 30,700 units. EVs accounted for 7.7 percent of total passenger vehicle sales, up from 5.9 percent in August 2025. However, EV penetration was slightly lower than the 8.1 percent recorded in July 2026.

“Buyer hesitancy to switch to E20 appears to have fueled the shift to CNG, hybrids and EVs,” the report said.

Tata Motors’ EV share recovered to around 43 percent in August 2026, the highest level since December 2025, compared to around 42 percent in July 2026 and 41 percent in August 2025. The recovery was supported by the company’s broad portfolio of electric vehicles and the recent launch of the Tiago EV.

In contrast, JSW MG Motor’s share fell to around 15 percent from 28 percent in August 2025 due to increasing competition. Mahindra & Mahindra’s share also declined to around 21 percent in August from 23 percent in July, while Maruti Suzuki captured around 5 percent of the electric vehicle market following its entry into the segment.

Delhi recorded the highest EV penetration in the country during the month.

“Regionally, Delhi had the highest EV penetration at ~19 percent as of Aug 26, although this was inflated by fleet registrations; excluding VinFast-supplied taxi fleet registrations, we estimate base penetration at ~12-14 percent, still well above the national penetration of 7.7 percent,” he said.