In August, sales of alternative-fuel passenger vehicles in India surpassed those of petrol-powered cars for the first time, according to an auto dealers’ association on Monday, amid rising oil prices driven by the Middle East conflict and growing public discontent over higher-ethanol-content fuel.
According to the Federation of Automobile Dealers Associations (FADA), which represents dealers of major car and two-wheeler manufacturers, alternative-fuel vehicles including compressed natural gas, hybrid, and electric models made up nearly 42% of passenger vehicle sales, while petrol-powered vehicles accounted for around 41%.
“This transition was inevitable,” FADA President Sai Giridhar told Reuters.
He said that although worries related to E20 may have initially pushed buyers away from petrol vehicles, the shift is now being maintained by a broader range of alternative-fuel models, better electric vehicle driving range, and the gradual rollout of charging infrastructure.
India, the world’s third-largest car market, is moving from E10 petrol to E20, which contains 20% ethanol, in an effort to cut dependence on imported crude oil.
However, the move has faced criticism from owners of older vehicles, who fear the new blend could lower fuel efficiency.
The government has previously rejected these concerns as “wild claims” and urged the public not to “fall for the rage bait.”
India’s automobile retail sales climbed 17.5% year-on-year in August to 2.4 million units, marking a record for the month.
This growth came even as major automakers implemented price increases this year to offset higher input costs. Giridhar cautioned, however, that additional price hikes could undermine the gains achieved through last year’s tax reforms aimed at boosting consumption.
On Monday, the country’s largest carmaker, Maruti Suzuki India, announced it will raise prices on select models by up to 20,000 rupees starting in September, its third price hike since May.
India is entering its annual festive season, a period that typically drives strong demand for high-value purchases.
Giridhar noted that, despite inflationary pressures and rising prices, dealers remain confident about sales prospects. Passenger-vehicle inventory rose by about five days from end-July levels to roughly 38–40 days, according to FADA.