New Delhi,June 2: India’s electric vehicle (EV) market witnessed a sharp rise in demand during May 2026, as soaring fuel prices amid the ongoing Iran conflict pushed more consumers towards battery-powered alternatives. According to reports by Nomura and HSBC, EV penetration in passenger vehicles climbed to 6.4 per cent in May, compared to 4 per cent in FY26, while electric two-wheelers accounted for 8.9 per cent of sales, up from 6.5 per cent last year.

Nomura, a global financial services group headquartered in Tokyo, Japan, and in India noted that demand sentiment has decisively shifted towards EVs, calling the sector “at an inflection point” in the Indian market. HSBC echoed this view, estimating electric two-wheeler penetration at 9.3 per cent and passenger EV penetration at 6.6 per cent in May, attributing the surge directly to rising fuel costs.

Among automakers, Tata Motors emerged as the biggest beneficiary, reporting an 85 per cent year-on-year increase in EV sales. The company also revealed that bookings have grown 2.5 times over the past two months, particularly in the sub-Rs 15 lakh segment. To meet demand, Tata plans to expand production capacity from 10,000 units a month to 15,000 units.

The two-wheeler segment saw even stronger momentum. TVS Motor led the market with around 42,000 electric scooter registrations in May, followed by Bajaj Auto and Ather Energy. Ather’s sales more than doubled year-on-year, boosting its market share to 16.5 per cent, according to Nomura.

While rising commodity costs remain a concern for manufacturers, both brokerages believe the EV market is gathering unstoppable momentum. Policy support, consumer acceptance, and the economic push from fuel price hikes are combining to accelerate adoption.

The oil marketing companies raised petrol and diesel prices by Rs 8 per litre over two weeks in April, as the Indian crude basket stayed above $100 per barrel for three consecutive months. The prolonged Middle East crisis, with disruptions in the Strait of Hormuz - a key transit route for 20 per cent of global oil and gas exports — has intensified supply concerns.

With peace negotiations between the US and Iran faltering and ceasefire breaches continuing, analysts expect further volatility in oil prices. Indian oil companies are currently losing Rs 550 crore a day on petroleum sales, as the government reins in hikes to shield consumers.

For now, the crisis has accelerated India’s EV transition, with May 2026 marking a turning point in consumer sentiment towards sustainable mobility.

India’s EV sales surged in May 2026, with passenger EV penetration rising to 6.4% and two-wheelers to 8.9%, as soaring fuel prices amid the Iran war pushed buyers towards electric alternatives.