Fuel Price Shock Accelerates India's Shift Away From Petrol as EV, CNG Penetration Hit Record Highs

Rising fuel prices following the geopolitical tensions in West Asia have accelerated India's ongoing shift towards alternative powertrains, pushing petrol's share of passenger vehicle retail sales below 50 per cent for the first time while electric vehicles and CNG models climbed to record levels in June.

Retail registration data from the government's VAHAN portal shows petrol vehicles accounted for 49.6 per cent of passenger vehicle sales during June, compared with 54.2 percent in 2025. CNG penetration climbed to an all-time high of 24.5 per cent, while battery electric vehicles reached a record 7.7 percent of the market. The data was sourced from Ankush, who goes by the name @ferrarirules on X.

The figures suggest buyers are responding faster to higher running costs than manufacturers can alter their product portfolios.

Manufacturers with established CNG and EV portfolios gained the most.

Tata Reaches New Milestone
Tata Motors moved closer to becoming India's first mainstream manufacturer where nearly half of all retail sales come from alternative fuels.

The company derived 48.6 per cent of June sales from CNG and electric vehicles combined. EVs alone accounted for 21.3 per cent of retail registrations, the highest in the company's history, while CNG contributed another 27.3 percent.

Consequently, petrol's contribution declined to 41.3 per cent, continuing a steady reduction over recent months.

The diversified portfolio has allowed Tata to benefit from both rising EV adoption and growing consumer preference for lower running costs through CNG.

Mahindra Boosts EV Credentials
Mahindra continued to prove that premium SUVs can successfully make the transition from diesel to battery electric vehicles directly.

Mahindra's June registrations had a 14.4 per cent share of electric vehicles, more than doubling from around 6 per cent in 2025.

The rise has been primarily at the expense of diesel, which saw its share drop from 75.8 per cent to 69.9 per cent as acceptance of the company's Born Electric SUV range grows.

Unlike most mass-market rivals, Mahindra has largely skipped CNG, instead using battery electric vehicles as its primary alternative powertrain.

Global OEMs Remain Exposed
Among major multinational manufacturers, Hyundai and Kia remain heavily dependent on petrol.

Hyundai derived 61.8 per cent of June sales from petrol vehicles, while EVs accounted for just 0.8 percent.

Kia was even more reliant, with petrol contributing 67.7 per cent of retail sales. Its ability to benefit from changing consumer preferences was limited by the lack of factory-fitted CNG products and a relatively small EV portfolio.

Toyota remains India's strongest hybrid player, with strong hybrids contributing 25.9 per cent of sales, while increasing volumes from rebadged Maruti Suzuki CNG models helped lift its CNG share to 15.4 percent.

June's data suggests India's powertrain transition is increasingly becoming a multi-pathway market, with consumers choosing between CNG, hybrids and EVs depending on price, running costs and vehicle category, rather than relying overwhelmingly on petrol.