The global India Flexfuel Cars Market is estimated to be valued at US$ 611.8 Mn in 2023 and is expected to exhibit a CAGR of 15% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Overview:
Flexfuel vehicles or Flex-fuel vehicles are capable of running on gasoline blended with ethanol up to 85% ethanol (E85). These vehicles include flexible-fuel engines that allow running on various gasoline-ethanol fuel mixtures without requiring any modifications. Growing demand for vehicles powered by alternative fuel source and reducing dependence on petrol is driving demand for flexfuel vehicles in India. Flexfuel vehicles provide better mileage, lesser emission of greenhouse gases compared to regular gasoline vehicles. Flexfuel cars also offer more affordable motoring as ethanol fuels are often cheaper than gasoline.
Market key trends:
Growing personal disposable income is expected to drive demand for private vehicles in India during the forecast period. As flexfuel vehicles offer cost savings on fuel without compromising on performance, increasing personal income is projected to boost sales of flexfuel cars in the country. According to Trading Economics, per capita personal disposable income in India increased from US$ 1,661.4 in 2017 to US$ 2,038.6 in 2021. Rising affordability of Indian middle class for private vehicles along with fuel cost benefits of flexifuel technology is expected to significantly boost adoption of flexfuel cars in India over the coming years.
Porter’s Analysis
Threat of new entrants: Low barriers to entry due to flexible regulations. However, new entrants face threat from established brands having strong distribution network and loyal customer base.
Bargaining power of buyers: High bargaining power of buyers due to presence of many established brands offering similar products. Buyers can negotiate on price and switch to substitutes easily.
Bargaining power of suppliers: Low bargaining power of suppliers since raw materials used in manufacturing flex fuel cars such as steel, electronics are commoditized and available from multiple sources.
Threat of new substitutes: Threat from electric vehicles is moderate as government is promoting adoption of eco-friendly vehicles through subsidies and tax benefits. However, high cost of EVs and lack of charging infrastructure limits their sales currently.
Competitive rivalry: Intense competitive rivalry among established brands to gain market share through new product launches, competitive pricing and expansion of distribution network.
Key Takeaways
The India Flexfuel Cars Market Share is expected to witness high growth, exhibiting CAGR of 15% over the forecast period, due to increasing government support through tax benefits and subsidies to promote eco-friendly vehicles.
South India region is expected to witness fastest growth in India flexfuel cars market during forecast period. States like Karnataka and Kerala are investing heavily in promotion of electric vehicles and setting up of charging infrastructure which will boost sales of eco-friendly vehicles like flexfuel cars.
Key players operating in the India Flexfuel Cars Market are Maruti Suzuki, Hyundai, Tata Motors, Nissan, Renault, Mahindra & Mahindra, Toyota, Honda, Ford, Volkswagen. Maruti Suzuki leads the market with offerings like Celerio and Dzire flexfuel variants. Hyundai is also a major player with flexfuel versions of Santro, Grand i10 and Verna models.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
