Inside India's electric cargo revolution: who's winning, who's catching up, and what's next
three-wheeled goods carriers
— has grown at a rapid 29.46% CAGR between FY2023 and FY2025. But FY2025 brought a twist: sales dipped 15% compared to the previous year. The reason? A subsidy cut under the PM E-Drive scheme, which now offers ₹2,500 per kW (capped at ₹25,000 per unit) — half of what the Ministry of Heavy Industries (MHI) earlier provided to boost locally made E3Ws.
Why the post-COVID surge happened
The e-commerce boom has been the primary catalyst for demand. High-speed
electric cargo vehicles
offer lower total cost of ownership and minimal maintenance, making them attractive for last-mile logistics. Financing support has also expanded, with banks, OEMs, and EV-specific lenders offering customised loans and payment plans. According to JMK Research & Analytics, this combination of market demand, financing accessibility, and the entry of established ICE brands like Bajaj and TVS has transformed the segment's growth trajectory.
Who's winning the L5 cargo race
Mahindra has built a stronghold, grabbing 26% of the market in FY2025 with a diversified range and early gains from FAME II and state incentives. It also leads on EV penetration — 62% of its cargo sales in FY2025 were electric. Bajaj, a legacy ICE brand, entered the fray in June 2023 and quickly made its mark — 17% market share, 9% EV penetration, and a staggering 361% YoY growth in FY2025, backed by brand trust and 4,717 units sold in the year.
E4W goods carriers: big growth, smaller base
Electric four-wheeler cargo carriers have grown at an eye-popping 729% CAGR between FY2023 and FY2025, and even posted 9% YoY growth last year. Tata Motors is the dominant player here with 61% market share. But the segment still trails L5 E3Ws due to higher upfront costs, less manoeuvrability in tight city lanes, and fewer charging points for larger vehicles.
A senior MHI (Ministry of Heavy Industries) said: 'We see electric cargo vehicles as critical to meeting India's 2030 clean mobility targets. The priority now is to align incentives with infrastructure growth so that both L5 three-wheelers and E4W goods carriers can scale sustainably.'
What's next
With India's e-commerce market showing no signs of slowing, electric cargo vehicles are set to become a backbone of last-mile delivery. In Tier 1 cities, fleet operators are already using 'porter systems' to move goods efficiently within city limits.
Central and state incentives, including Maharashtra's new EV policy targeting 30% EV registrations and 50% adoption in fleet and utility vehicles by 2030, are expected to boost adoption.
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