Volvo Car India, a premium Swedish automaker, remains optimistic about fiscal year 2026 despite the unpredictable nature of the automotive sector due to global challenges. According to Jyoti Malhotra, Managing Director at Volvo Car India, the company is committed to staying in India over the long term. "While we look forward to FY26 with enthusiasm, factors like geopolitical instabilities, trade barriers, and economic setbacks are causing fluctuations in both consumer behavior and financial markets. Although these issues were somewhat expected when the year began, their full extent has become clearer as time progresses; however, our course remains steadfast," Malhotra stated to romero.my.iddia.
During the initial quarter of the year, Volvo Cars introduced their newest model, the XC90, which serves as their top-tier Internal Combustion Engine (ICE) sports utility vehicle (SUV). This particular variant includes a mild-hybrid feature. Additionally, they announced plans to introduce the EX30—a smaller all-electric SUV—globally; it’s slated to reach Indian markets before the end of this calendar year. Our objective is to launch at least one electric vehicle annually moving forward. Even amid ongoing geopolitical challenges, we remain committed to maintaining our strategic direction within the Indian marketplace. It remains crucial for us to stay vigilant regarding current developments. Striking an equilibrium between short-term goals and long-term aspirations continues to guide our approach,” remarked the Managing Director.
Currently, electric vehicles (EVs) account for approximately 2% of the passenger car market in India; however, this figure is projected to increase to 5% by FY27 and reach 9% by FY30 as per a Nomura report. The expansion can be attributed to heightened public consciousness, governmental benefits, introduction of new EV designs, and enhanced charging facilities.
In April 2025, Volvo Car India reported selling 35 electric vehicles (EVs), down from 40 units during the same month in 2024. Looking forward for the coming year, the company plans to concentrate more on EV sales. According to Malhotra, “Currently, electric cars make up only 2% of all vehicle sales. Within this category, luxury electric models account for about 6-7%, where our brand holds nearly 24-25%. Should growth continue at its present rate, I predict that by the end of the decade, electric cars could represent 25% of overall sales, with luxury EVs likely reaching approximately 40%.”
He mentioned that ICE-powered vehicles will also keep being produced. In their lineup, 24% consist of battery-electric vehicles (BEVs), while the remainder come equipped with internal combustion engines (ICEs) along with mild-hybrid systems. At present, Volvo Cars has no intentions of launching plug-in hybrid electric vehicles (PHEVs) in India. This decision stems from the country’s taxation system where PHEVs face a hefty 28% Goods and Services Tax (GST). Additionally, when considering all associated levies and surcharges like cesses, the total effective tax rate climbs up to approximately 48%, making these models economically unviable within this market. “Globally, we possess the capabilities needed to adapt our strategies according to local conditions. As it stands now, under the prevailing fiscal framework, introducing PHEVs isn’t deemed advantageous. While the administration encourages movement toward greater electrification, we fully support this initiative.”
Clearing Roadblocks
Across numerous regions, electric vehicles often receive exemptions or substantial reductions in road taxes. These incentives aim to promote wider acceptance of EVs. Nonetheless, these benefits may differ based on regional regulations set forth by various local governments; certain states might provide limited exemptions along with waiving registration charges. As an example, Delhi’s proposed Electric Vehicle Policy 2.0 suggests extending road tax breaks even to hybrid models. Under this policy, battery electric vehicle owners would enjoy full relief from both road tax and registration fees during its term, though this applies solely to those vehicles priced at Rs. 20 lakhs or less when purchased directly from dealerships. In contrast, Haryana and West Bengal offer total immunity from road taxation for all types of electric vehicles. Conversely, places like Telangana, Kerala, and Andhra Pradesh still enforce varying degrees of road tax levies without standardization across their systems.
The key factor regarding state governments involves road taxation policies. These frequently fluctuate across various regions over time. It’s crucial for each state administration to consider implementing minimal or zero road taxes specifically for electric vehicles. Such an initiative could significantly boost the adoption and distribution of EVs," according to the managing director.
When discussing electric vehicle (EV) charging, there are three main categories: residential, commercial, and public stations. Although efforts are increasing for enhancing commercial and public charging infrastructure, domestic setups require more focus. Initially, one must choose a suitable place within their residence for installing this equipment. This area should be convenient, secure, and close to electricity supply points. A major challenge lies in confirming whether your house’s wiring can support the extra demand from an EV charger—especially important when considering a Level 2 model that demands a 240-volt connection.
"One major requirement is the simplicity of setting up residential charging stations along with support from relevant district authorities. Every electricity distributor must ensure that it’s straightforward for individuals to have their home chargers installed. Regardless of whether you reside in a terraced house or an apartment, robust assistance is essential," he remarked lightly.
A key factor in making electric vehicle (EV) charging more user-friendly is the development of a consolidated application. An instance is the eHUB offered by MG, which provides a comprehensive EV charging service compatible across various brands. Beyond pinpointing available charging points, one major hurdle for EV owners lies in managing numerous billing platforms at individual stations, necessitating multiple applications on their phones. Introducing a Unified Payment Interface (UPI)-based system for EV charging seeks to streamline this process by enabling users to find, book, and settle charges via a singular interface. This would eliminate the requirement for separate apps per charger. To fully realize widespread acceptance of EVs, it’s crucial that the supporting infrastructure becomes easily accessible, swift, and broadly usable.
At present, there isn’t a cohesive system like this available. “While there are several applications out there, their reliability varies widely. Having just one integrated application could offer greater transparency. Moving ahead, similar to how UPI functions in India, it would be beneficial for payments too. What’s needed is a singular comprehensive solution, and with ongoing emphasis from the government, I think we may see progress on this front soon,” he stated.
Regional superpower
Since 2017, Volvo Car India has been manufacturing its vehicles within India starting with the assembly and rollout of the XC90 XUV from their facility in Hoskote near Bangalore. In January 2024, they reached a significant production mark of 10,000 units at their site in Bangalore, which included both internal combustion engine (ICE) and battery electric vehicle (BEV) models. This landmark unit was an entirely electric XC40 Recharge SUV. Prior to this initiative in 2017, the brand imported fully built-up cars exclusively as completely built-unit (CBU) imports.
"our aim is to manufacture every vehicle we produce here in India. This aspiration extends to our most recent model, the EX30. In the coming years, this strategy will be applied consistently across all of our vehicles. Consequently, achieving the production milestone of the next 10,000 units will occur at an accelerated pace," Malhotra stated additionally.
Discussing exports from India, he mentioned, "'Currently, our priority lies with the domestic market. This area holds significant promise for us, so we aim to capitalize on this opportunity. At present, we do not export products from India; instead, we manufacture and sell within the country.'"
India’s varied geography is boosting the company's sales figures. “Our sales are increasing across various areas beyond just major metropolitan cities. Currently, about 15 to 20 districts outside these urban centers account for much of our revenue. To capitalize on this trend, we've broadened our distribution network and dealer presence so that we can be found everywhere. These lesser-known locations are contributing significantly to our total sales.”
Worldwide, Volvo Cars experienced substantial growth in sales of their electrified vehicles. In the entirety of 2024, they sold 175,194 fully electric cars, marking a rise of 54 percent from the previous year, along with selling 177,593 plug-in hybrids, which represents a 16 percent boost over 2023 levels. Electrified vehicle sales comprised 46 percent of total global car sales by Volvo in 2024. Additionally, fully electric cars made up 23 percent of Volvo’s worldwide sales in 2024, as opposed to just 16 percent in 2023.
In India, however, Volvo Cars experienced a decrease in electric car sales in 2024 as opposed to 2023. The company sold 442 electric vehicles in 2024, down from 570 in 2023—a drop of 22 percent—according to statistics provided by the Federation of Automobile Dealers Associations (FADA).
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