Record June auto sales as electric two-wheelers cross 10% share

India's auto retail sales hit an all-time high in June 2024, and electric two-wheelers crossed a key milestone, they now make up more than 10% of the segment. The data, released by the Federation of Automobile Dealers Associations (FADA), shows total retail sales of all vehicles reached 2.25 million units last month. That is 8% higher than June 2023.

Two-wheelers led the charge. Sales of all two-wheelers, petrol, diesel, and electric, rose 8.6% year-on-year to 1.64 million units. But the real story is inside that number. Electric two-wheelers alone sold 1.16 lakh units, grabbing a 10.3% share of the two-wheeler market. This is the first time the segment has crossed the double-digit mark.

EV boom pushes past 10%

The jump in electric two-wheeler sales is not a one-month spike. The segment has been climbing steadily. In April 2024, EVs held 9.1% of the two-wheeler market. In May, that rose to 9.6%. June's 10.3% shows the trend is accelerating. Industry analysts point to new model launches, wider dealer networks, and state subsidies under the FAME II scheme as drivers. But they also warn that the recent reduction in FAME II subsidies could slow growth in the second half of the year.

Three-wheeler sales also set a record. The segment sold 1.05 lakh units in June, up 7.7% from last year. Electric three-wheelers now account for 55% of that segment. Passenger vehicles, cars, SUVs, and vans, sold 3.36 lakh units, a 3.4% rise. But the growth rate is slowing compared to earlier months. Commercial vehicles saw a slight dip of 0.7%, selling 86,000 units. Tractors rose 7% to 84,000 units.

Rural demand and monsoon hopes

FADA president Manish Raj Singhania said the record sales were driven by strong rural demand, especially for two-wheelers and tractors. "The monsoon has been normal so far, which is boosting sentiment in farming communities," he said. But he also noted that inventory levels for passenger vehicles are swelling. Dealers are sitting on stock worth 60-65 days of sales, well above the healthy 30-day mark. That could lead to heavy discounts in the coming months.

Singhania added that the wedding season in June helped push sales across segments. But he cautioned that the second quarter might see a slowdown if the monsoon turns patchy or if fuel prices rise again.

What it means for clean energy

For a country that sees over 20 million two-wheelers sold each year, the 10% EV share is a big deal. It means roughly 2 million electric two-wheelers could be sold annually at current rates. That would cut petrol consumption by millions of litres and reduce urban air pollution. But the charging infrastructure remains patchy. Most buyers still charge at home, and public charging points are concentrated in big cities.

The government wants EVs to make up 30% of new vehicle sales by 2030. Two-wheelers are the easiest place to start, they are cheaper, lighter, and need smaller batteries. But the subsidy cuts and rising raw material costs could test the industry's momentum.

For now, the numbers are clear. June 2024 was a record month for Indian auto retail, and electric two-wheelers are no longer a niche. They are one in ten new two-wheelers sold. The question is how fast the next 10% comes.