Not rivals but allies — hybrids are powering up India’s EV dream, says an HSBC report. Hybrids are boosting EV growth and buyer confidence as the nation accelerates toward cleaner mobility.
Hybrid vehicles are aiding, rather than competing with, electric vehicle (EV) sales in India, according to a new study by HSBC Global Research. The report highlights that India’s transition to clean mobility will involve a mix of technologies, with hybrids, compressed natural gas (CNG), and biofuels playing a key role during the shift.
As cited by The Economic Times, the research states that strong hybrid electric vehicles (SHEVs) and battery electric vehicles (BEVs) cater to different consumer segments. It challenges the idea that hybrids hinder EV growth, describing the relationship as “incremental, not zero-sum.”
The states that offer incentives for hybrids have also seen rising EV sales. For instance, Uttar Pradesh, India’s largest passenger vehicle market, has provided SHEV subsidies, yet BEV sales grew at a similar pace during FY25. This suggests that hybrid adoption could be encouraging EV interest.
The report pointed out that promoting hybrids supports the overall clean mobility ecosystem. New model launches and incentives are expected to increase adoption further.
EV penetration in the four-wheeler segment has shown steady growth. It rose from 1.9% in the first half of FY25 to 3.2% in the ongoing first quarter of FY26. This growth has been driven by new offerings such as the MG Windsor and Mahindra & Mahindra’s BEVs.
Hybrid vehicle market share also grew slightly in India, increasing from 2.1% in FY24 to 2.4% in FY25. Despite state-level subsidies, hybrid sales stabilised this year, largely due to the diesel vehicle share remaining constant.
The report also pointed to customer openness to EVs when concerns are addressed. MG offered battery leasing to ease replacement cost fears, while Mahindra’s models tackled range anxiety and added aspirational value.
Introduced by Maruti Suzuki and Toyota in late 2022, SHEVs have gained traction by drawing buyers away from diesel variants. While hybrid growth plateaued in FY25, new models and government policies are likely to push further expansion.
