Understanding
the ecosystem
The EV
logistics ecosystem spans a range of vehicle segments, from electric 3-wheelers,
light commercial vehicles (E-LCVs) and electric medium & heavy commercial
vehicles (E-M&HCVs) to electric rail solutions (E-rails) for rail logistics.
Supporting this transition are battery-as-a-service (BaaS) models, growing
financing options, and investments in fleet and charging infrastructure. These
segments are critical to India's clean mobility goals, given that EV
penetration in logistics is only 8-10%.
Exhibit
1: EV logistics
ecosystem in India
How big
is the opportunity?
In FY24,
India’s EV logistics market stood at ~US$ 15B. By FY30, this is
projected to grow 3x to ~US$ 49B, driven by the electrification of
last-mile delivery (3W), urban freight (LCV), and rail logistics.
Exhibit
2: EV Logistics Opportunity in India
The EV
penetration in 3W and E-LCV categories, is expected to reach 51% and
6% respectively by FY30. However, electrification of medium and heavy CVs
will remain limited (<1%) due to payload constraints, range limitations, and
battery cost economics.
TCO analysis: Are EV fleets economically
viable?
For certain use cases, especially intra-city delivery, the total cost of
ownership (TCO) of EVs is already lower than ICE vehicles. E-3Ws and E-LCVs
enjoys up to 15-20% lower TCO compared to ICE counterparts driven by lower
running costs, reduced maintenance, and government incentives. Fleet operators
are increasingly adopting models like battery swapping and leasing to overcome
upfront capex challenges.
Exhibit 3: TCO Comparison: ICE
vs. electric 3W and LCV
Despite favourable TCO, challenges still persist.
EVs have lower payload capacity, limited charging infrastructure, and higher
battery replacement costs. For M&HCVs, electrification remains a long-term
goal requiring breakthroughs in battery density and fast-charging technologies.
What will drive scale?
Several enablers are unlocking growth, creating a
supportive environment for EV fleet adoption across India:
- Ecosystem maturity:
Players like MoEVing and Zyngo are scaling EV fleets across urban centers
- Innovative financing:
Leasing, pay-per-use, and battery subscription models are reducing entry
barriers
- Digital platforms:Fleet Management Systems (FMS) and Charging Management Systems (CMS)
are improving fleet uptime and route optimization
- Policy tailwinds: FAME II incentives, state subsidies, and road tax exemptions
What should stakeholders do?
- OEMs must invest in
vehicle platforms optimized for logistics, especially in the E-LCV segment
- Fleet operators
should prioritize high-utilization intra-city routes and adopt leasing/BaaS
models to minimize upfront risk
- Infra providers
need to build dense urban charging networks aligned with high-traffic logistics
corridors
- Financiers should create
EV-focused underwriting models, leveraging telematics for risk scoring
Conclusion
The economics of EV logistics in India are moving from
promise to profitability, especially in the E-3W and E-LCV segments. With
policy momentum, ecosystem support, and tech innovation, EV fleets are poised
to transform India’s urban freight landscape. However, success will depend on
strategic adoption, financing innovation, and focused infrastructure rollout.
For a deeper dive, refer to the full report- Electrify30:
The Future of Mobility