Power Shift: India’s EV Grand Prix
Legacy automakers are winning India’s EV race by doing less, better.
India’s electric-vehicle market, though still small in absolute terms, is one of the fastest-growing in the world. The early years belonged to headline-grabbing startups promising rapid transformation. Today, however, market leadership is shifting to companies with decades of manufacturing experience, deep distribution networks and entrenched brand trust. A recent discussion with two well-placed observers helps explain the shift.
Not long ago, Ola Electric looked like the future on two wheels. With a market share that touched 80% at its peak, it seemed to have cracked the code for mass EV adoption in India. But the view in the rear-view mirror has changed. Today, Ola’s market share is projected to slump to roughly 17%. In its place, two industry veterans, TVS and Bajaj, are taking command.
The conversation behind the curtain
These insights emerged from a chat with:
Parag Parmar is currently Head of Digital Customer Experience at Hindalco Industries, a tier-one supplier to leading automotive OEMs. He brings over a decade of sector experience spanning manufacturing and consulting. His career began at Mahindra & Mahindra, giving him direct exposure to OEM operations, before moving into EY-Parthenon’s business consulting division, where he advised automotive and consumer companies on corporate strategy, digital transformation, and execution. His work has consistently focused on the customer-facing side of the value chain, making him well placed to assess how product strategy, service quality, and brand trust affect market performance.
One product. Many payoffs.
While Ola raced ahead with three different EV scooter models, TVS and Bajaj kept it brutally simple: one electric two-wheeler model each.
It was less about frugality and more about focus. Manufacturing a single model allows CapEx to be tightly contained. It can cost roughly ₹50-100 crore to develop a platform for each model. Concentrating spending on one flagship avoids self-cannibalisation, simplifies the supply chain, and makes after-sales service less of a logistical nightmare. In a category where customers are not spoilt for choice, having “more” isn’t necessarily better. And because their products went through reasonably more robust testing, safety certification, and refinement, the big incumbents were ready to deliver not just novelty, but reliability.
That reliability was reinforced by something Ola simply couldn’t replicate overnight: a nationwide service and distribution network that had been nurtured for decades.
In January 2024, Ola Electric had around 800 stores nationwide. The massive expansion to about 4,000 stores happened later in December 2024 with the opening of over 3,200 new outlets, as part of a record network rollout.
In July 2025, Ola Electric faced mass closures in Maharashtra due to regulatory actions by the state government. Authorities ordered the shutdown of nearly 90% of Ola’s outlets in Maharashtra for lacking valid trade certificates (permits to store and sell unregistered vehicles). Reports confirm that 388 out of 432 inspected showrooms in the state were non-compliant and consequently shut down. Since Ola had about 450 showrooms in Maharashtra, this means approximately 388 were ordered closed in that state alone, disrupting 12% of Ola’s national sales.
“It’s not their fault; scaling that kind of network takes time. But in the EV space, where customers are already anxious about the product, its range and maintenance, weak after-sales support kills confidence.”
The Invaluable Intangible: Trust
Trust in automotive is not built by marketing slogans or venture funding. It comes from decades of delivering vehicles that start on the first try and from mechanics in small towns who know the brand inside out. Ola’s early missteps, delivery delays, quality complaints, and erratic servicing became PR fodder that it struggled to counter. Moreover, Ola’s leadership wasn’t able to counter the narrative, further eroding trust.
For the average Indian scooter buyer, TVS and Bajaj are family names. Your father or uncle probably bought one. They’re neighbourhood brands, with service centres in small towns, not just metro showrooms. This trust is intangible but invaluable.
As the panel put it, “Venture funds can help you scale, but brand equity and trust are very difficult to build, especially in India.”
Ather Energy, in contrast, has played a slower, more deliberate game by positioning itself as a premium, aspirational product. Its association with Hero MotoCorp lent credibility and perhaps influenced build quality. Its smaller but loyal customer base allows it to maintain higher margins without overextending.
“Ather’s story is more promising as of now,” Parag observed.
Three Wheels, Faster Turn
If the two-wheeler EV market is a slow climb, the three-wheeler market is already in a sprint. Penetration is nearing 50%, largely led by legacy brands such as Mahindra, Piaggio, and Kinetic.
Mahindra’s story here is particularly noteworthy. The company stumbled in the diesel wide-body market but pivoted into the unorganised L3 EV segment. Organising it under the Mahindra name, improving the product, and then climbing to the L5 passenger segment turned it from a challenger into a leader.
L3 vehicles are small, low-speed electric three-wheelers often seen in rural and unorganised markets. Think of the ‘Jugaads’ here. Whereas L5 vehicles are larger, faster passenger autos, like the common city rickshaws in Delhi, built for carrying people over short urban routes.
Regional loyalties also matter here: Bajaj dominates in the north and west, TVS in the south. Piaggio thrives in eastern states such as Jharkhand & Bihar. Kinetic’s EV autos are common in tier-2 and tier-3 towns.
Small upstarts like Euler and Omega Seiki have found niches, for example, goods delivery rather than passenger transport, but it’s challenging to reach critical mass here. But don’t discount the innovators just yet. YC Electric has eked out a respectable 6% market share, which is commendable.
The playbook here is clear: don’t overscale, focus on product-market fit.
Subsidising Substance
Subsidies have undeniably fueled EV growth, especially in three-wheelers. In two-wheelers, however, the market is gradually maturing, with customers buying for comfort and dependability, not just price advantage now. Four-wheelers are still at enthusiast-level penetration, mostly bought as secondary cars for city use.
The challenge for every EV player, legacy or startup, is the same: survive long enough to see the market truly take off.
As Parag summed it up: “Capital is a good propeller, but it’s not enough. In the auto sector, you need patience. You can’t do too much, too soon.”
Repeating the Jio-poly
The discussion drew a striking comparison between the automotive sector and another once-crowded industry: telecom. Over the past decade, India’s telecom sector consolidated into three mammoths, Airtel, Jio, and Vodafone Idea, leaving little room for fringe players. A similar shake-out may be ahead for automotive, especially as the EV segment matures. In such a future, surviving players will be larger, better-capitalised, and more deeply integrated across the supply chain.
The Capital Allocator’s Opportunity
For investors, the real opportunity may not lie in betting on the next Ola or Ather, but in the less glamorous arteries of the EV ecosystem. The supply chain, component manufacturing, charging infrastructure, and specialised technology for OEMs are all growth frontiers. These areas will demand capital, engineering talent, and operational scale, making it a fertile ground for India’s mid-market and private finance to make a long-term impact.
The opportunity is asymmetric: rather than competing in the consumer-facing race, capital allocators can back the companies building the machinery, batteries, software, and logistics systems that incumbents will need to retain their edge.
Gearing up
Even the faltering pioneers have left their mark. “They played a role in defining this category and pushing it forward,” Parag said of Ola. But he added the warning: “Shareholder wealth cannot be delivered if you fail to deliver sustainable value to the customer.”
If the past two years are any indication, the EV revolution in India won’t be led by the fastest movers, but by the most steadfast builders. In a country where mobility is as much about trust as technology, old money might just keep beating new energy — at least for now. And much like the telecom industry, the market will likely consolidate around a few major players.