In 2025, India’s passenger vehicle market showed a notable shift in fuel preferences as petrol car sales declined, while CNG, electric vehicles (EVs), diesel and hybrid models recorded growth. The trend highlights changing consumer choices, rising fuel cost sensitivity, and growing demand for cleaner, more efficient alternatives.
Petrol Cars Lose Market Share
Data from the auto industry indicates that petrol-powered passenger cars were the only segment to see a fall in sales volume in 2025 compared with the previous year. Although petrol models have traditionally dominated the Indian market, their appeal has waned as buyers increasingly prioritise fuel economy and lower running costs.
Toyota, Maruti Suzuki, Hyundai and other key manufacturers recorded fewer petrol model registrations overall, even as some individual models maintained steady numbers. Industry analysts attribute this decline to rising fuel prices, shifting buyer preference toward greener options, and more competitive alternatives becoming available.
CNG Cars Gain Momentum
Sales of CNG-powered cars continued to grow in 2025, reflecting strong consumer interest in low-cost fuel options. Many customers now favour CNG variants for their significantly lower per-kilometre running costs compared with petrol.
Major manufacturers such as Maruti Suzuki, Hyundai and Tata Motors have expanded CNG offerings across popular models, making it easier for buyers to choose factory-fit CNG options rather than aftermarket conversions. The broader CNG network expansion across cities and towns has also supported this surge.
Electric Vehicle Demand Climbs
The electric vehicle segment sustained its growth momentum in 2025. EV sales rose significantly, driven by a wider range of models—from entry-level hatchbacks to premium SUVs—along with improved charging infrastructure and government incentives for buyers.
More affordable EV options and growing environmental awareness have made battery-powered cars a compelling choice for both city commuters and long-distance travellers. Consumers are increasingly factoring in lower operating costs and long-term savings when choosing EVs.
Hybrid And Diesel Cars See Growth
Alongside CNG and EVs, hybrid powertrains also recorded increased sales in 2025. Hybrid models attract buyers seeking a balance of fuel efficiency and performance without fully transitioning to battery-only vehicles.
Meanwhile, diesel cars, which had seen declining demand in prior years due to tighter emission standards, posted modest growth. Diesel remains popular among SUV buyers and long-distance drivers who value its torque and fuel efficiency on highways.
What This Means For The Auto Industry
The overarching trend suggests that Indian consumers are broadening their fuel choices and becoming more cost- and environment-conscious. Manufacturers have responded by diversifying their lineups with multiple fuel options, improved technology, and enhanced value propositions.
Shift toward alternatives also reflects broader policy support and infrastructure development, including subsidies for EVs, favourable tax treatment for CNG vehicles, and tighter emission norms encouraging cleaner technologies.
