Industry tailwinds India has emerged as the third largest automobile market in the world, and is expected to double in size to ₹ 25 trillion by 2030. Combined with the government’s goal to achieve net-zero emissions by 2070, clean mobility stands as one of the direct beneficiaries. The aim is to expand EV penetration from less than 6% in 2024 to 30% by 2030. India is miles behind countries like China and Europe, which sport 50% and 20% EV penetration, respectively, in new car sales. This leaves a long runway for the growth of EV manufacturers in India. To be sure, a bulk of India’s current EV penetration comes from 3-wheelers and commercial vehicles, with that in cars standing at just 2.6%. But electric cars are catching up quickly. More than 1 lakh electric cars were sold in India in FY25, an 18% increase over the previous fiscal. For comparison, overall car sales had seen a much more modest 4.9% growth during the year. Tesla's premium play Since the pandemic, mimetic desire, YOLO (you live only once), and probably even snob value have driven up the demand for premium products. Cars have been no different, with affordable carmakers like Maruti falling behind their peers who have pivoted faster towards producing more premium cars. But India’s electric car market is dominated by Tata Motors, MG Motor, and Mahindra & Mahindra, which together claim almost 90% of electric cars sold in India. Their electric cars are primarily placed in the affordable range. Among manufacturers who have electric cars in the premium range, BYD commands the highest share at 3.2%, followed by the newly listed Hyundai at 2.2%. While their share is small, they have been gaining ground fast. BYD and Mercedes-Benz have expanded their market-share by more than 1.5 times between FY24 and FY25. Such companies together claimed around 9% share of India’s electric car market in FY25, up from around 7% in FY24. Considering Tesla’s clout, its debut in India is expected to accelerate premiumization in India’s electric cars. The pie of premium electric cars is likely to get larger, benefiting Tesla too along the way.