Choices aplenty for car buyers; petrol moves to slow lane as CNG, hybrids, EVs chip away at its share

Mumbai: Petrol is losing its grip on India's car market, with sales coming under pressure in some of the country's biggest automobile markets as buyers increasingly look beyond conventional fuel.

Across Maharashtra, Haryana, Delhi, Rajasthan and Uttar Pradesh, petrol cars are losing ground even as CNG, hybrids and electric vehicles gain momentum, while diesel is seeing renewed interest in some markets. Adding to the shift is growing consumer anxiety over E20 petrol. Industry executives said concerns about mileage, compatibility and long-term ownership are increasingly featuring in purchase decisions.

But carmakers caution that E20 alone cannot explain the pressure on petrol. The bigger shift, they said, is that consumers now have more alternatives, with the economics and availability of these powertrains making them increasingly credible choices.


The shift is therefore not simply from petrol to electric vehicles. CNG is attracting buyers seeking lower running costs, while hybrids offer a middle ground for those looking for better fuel efficiency without depending on charging infrastructure. EVs are gaining traction as charging networks expand, while diesel continues to find buyers in markets and segments where range, highway driving and fuel efficiency remain important.

For the auto industry, this marks a fundamental change in how consumers choose cars.

‘Towards Alternate-fuel Vehicles’

The old petrol-versus-diesel equation is giving way to a market where multiple powertrains compete for the same customer.

The scale of the shift is becoming harder to ignore. Federation of Automobile Dealers Association vice-president Sai Giridhar said consumer hesitation around the E20 transition had nudged some buyers towards CNG, hybrids and EVs. In July, the combined share of CNG, hybrid and electric passenger vehicles reached 40.59%, just 1.09 percentage points behind petrol at 41.68%. A year earlier, the gap was 13.21 percentage points.

That narrowing gap is significant because the challenge to petrol is no longer coming from a single technology. CNG commands a sizeable share, while hybrids are attracting buyers seeking better fuel efficiency without giving up the convenience of an internal-combustion engine. EVs, too, are steadily gaining ground. “We do not see this as a long-term effect, as petrol sales have been seeing a slowdown of late and the direction has been towards alternate-fuel vehicles,” said a senior executive at a leading carmaker.

Carmakers are responding by keeping their options open rather than betting on a single technology. Maruti Suzuki is seeing strong traction in CNG while expanding into EVs and exploring other technologies. Hyundai is increasing its focus on CNG alongside EVs, petrol and diesel, while Tata Motors and Mahindra continue to build portfolios spanning electric and internal-combustion vehicles.

Other manufacturers are similarly maintaining a mix of powertrains as they wait to see how consumer preferences evolve. For petrol, the implications are clear. E20 anxiety may be accelerating the shift, but the underlying change is broader.