Electric vehicles are one important part of this shift, while the move towards E20 petrol is another. The suitable question here for the consumer is not about which change should come to the fore but how these changes are influencing the economics of mobility, writes Abhinav Kalia, Co-Founder & CEO, ARC Electric
The market for automobiles in India is moving towards a new stage. There is less consideration of whether to buy a petrol or diesel car and more deliberation on fuel efficiency, blending with ethanol, electric cars, and the overall cost of travel.
Electric vehicles are one important part of this shift, while the move towards E20 petrol is another. The suitable question here for the consumer is not about which change should come to the fore but how these changes are influencing the economics of mobility.
In my dealings with business enterprises and high-utilization vehicle fleets, there is one point that comes through loud and clear, the economics of an automobile is not determined only by its acquisition cost. It is equally determined by how it is used.
A Changing Fuel Landscape
India met its 20% ethanol blend goal in 2025, which was earlier set at 2030. According to government estimates, ethanol blending has already made a contribution in reducing crude oil imports and savings on foreign exchange.
This is a key component of India’s strategy to create greater diversification in transport energy.
Nevertheless, the consumer viewpoint should be pragmatic. Fuel efficiency, compatibility and cost per kilometer will have higher significance for an individual consumer compared to the actual percentage of ethanol blend. With the shift in the fuel system, consumers will increasingly need to focus not only on per liter costs but on the actual cost of operation.
This is when the mobility equation comes into play.
The Economics Look Different at Higher Utilisation
For fleet management operations, the distinction between a vehicle making 20 kilometers per day and the other one making 150-200 kilometers per day can be quite large.
An efficiently used vehicle consumes much fuel and needs more maintenance and downtime. Therefore, even minor differences in operating costs per kilometer can mean a lot for an entire year.
It is here that EVs become quite useful as well. Electric powertrains consume less energy and require low maintenance cost as their utility rises.
Adoption of EVs in India is growing beyond its niche use. Official records state that EVs made up 8.26% of the total number of vehicles adopted during FY2025-26 as compared to 0.08% during FY2015-16. Till June 2026, more than 26.5 lakh EVs were supported under PM E-DRIVE.
The Fleet Market Offers an Early View of What Comes Next
Fleets tend to be an early predictor of whether a mobility technology can prove economical at a larger scale.
The fleet manager cannot argue for the vehicle being cleaner alone; the vehicle needs to prove that it can successfully operate its route, be available, charge in time and offer an economic cost per kilometre.
That is how we have learned to assess the feasibility of using electric vehicles. The length of the route, the intensity of use, ability to charge and availability must be taken into account together.
That is how the process of adopting electric vehicles in different markets for private use can differ too.
The vehicle will be able to pay for itself much quicker if it is heavily used each day rather than just traveling a few kilometres by a privately owned vehicle.
Charging Is Becoming Part of Vehicle Ownership
As the adoption of EVs rises, access to chargers will be as important in the decision to buy EVs as access to fuel is currently.
For fleet users, this would imply that charging facilities will have to be considered on the basis of routes and idle times. For individual users, the availability of charging facilities at their homes, offices, or favorite destinations should be a consideration.
Public charging facilities are being developed in India as well, as per the PM E-DRIVE plan, which has provisioned ₹2,000 crore for public EV charging facilities.
The development of infrastructure will be key to success since the economic case for EVs is best made under convenient conditions.
The Transition Does Not Have to Be One-Dimensional
A total shift in the powertrain of the Indian vehicle fleet in a day’s time would not be practical, millions of petrol vehicles would be running around for years to come; hence, the developments in the current fuel system will be very relevant.
In addition to that, every single purchase of a new vehicle is a chance to think about whether electric mobility will serve you operationally and financially.
E20 and EVs are thus two elements of the transformation of India’s transport sector. While one runs within the current liquid fuel system reducing dependency on traditional petrol, the other constitutes an entirely different dimension where electricity replaces fuel.
It must be remembered that both aim at cutting down the cost of movement of goods and people.
The Consumer Equation Is Becoming More Personal
There is no one-size-fits-all solution for all buyers. The important question is getting more and more precise: How far does the vehicle have to go? How will it be parked? How predictable is the driving route every day? How much charging/refuelling infrastructure is there? And how long does the vehicle have to last?
For low-utilisation consumers, the initial economic efficiency and convenience of owning a traditional vehicle could remain an important consideration. In the case of high-utilisation consumers with predictable charging infrastructure, the argument for EVs becomes even more compelling.
Therefore, the Indian mobility revolution should not be about convincing consumers to use a new technology. Rather, it should be about providing them with sufficient information to make sense of the economics behind their choice.
The future of India’s auto industry will depend less on what drives their vehicles and more on how well the vehicles perform. With the evolution of fuel technologies and electrification, the mobility solutions of the future will be those that offer affordability, reliability and low cost of ownership alongside consumer requirements.