Posted by A new wave of electric vehicle (EV) startups is reshaping India’s two-wheeler (2W) and three-wheeler (3W) market. As the country pushes for cleaner transportation, these new companies are playing a significant role in driving EV adoption. This blog looks at the sales performance of these startups and examines their digital infrastructure, a crucial factor for their long-term success.
EV Startups: Sales and Market Contribution
The Indian EV market, particularly for 2W and 3W, has seen remarkable growth. In 2023, EV penetration reached 6.40%, with electric three-wheelers showing a robust 50% growth and contributing to over 54% of total EV sales. Electric two-wheelers and three-wheelers combined accounted for 95.5% of total EV sales in February 2023
Two-Wheeler (2W) EV Startups
The 2W EV segment is a major driver of the EV market in India, making up 59% of all EV units sold. While legacy manufacturers have entered the space, startups have emerged as dominant players.
- Ola Electric: Ola has established itself as a market leader. In 2023, the company sold over 266,000 EVs, capturing a significant 31% market share, up from 17% in 2022. In May 2023 alone, Ola Electric saw a 207% year-over-year increase in sales.
- Ather Energy: A key player known for its premium scooters and technology, Ather Energy is one of the top sellers in the 2W market.
- Other Notable Startups: Companies like Revolt Motors, Simple Energy, and Pure EV are also contributing to the growing market with their innovative products.
In the first seven months of 2025, total electric 2W sales crossed 700,000 units. Despite a dip in sales after a reduction in government subsidies in mid-2023, the market recovered, ending the year with record-high sales in the final quarter.
Three-Wheeler (3W) EV Startups
The 3W EV market is highly fragmented, with 496 different Original Equipment Manufacturers (OEMs) registered on the Vahan Dashboard. In 2023, India added over 568,100 electric three-wheelers, which accounted for 38% of new EV additions.
Unlike the 2W segment, which is dominated by a few large startups, the 3W market sees a mix of established players and numerous smaller startups. In May 2023, 58% of all 3W passenger vehicles sold were electric. Startups in this space include Strom Motors and Euler Motors, which focus on creating compact vehicles for urban commuting.
The Role of Digital Tech Infrastructure
For an EV startup, having a strong digital backbone is no longer a luxury but a necessity. It impacts everything from initial sales to long-term customer loyalty.
Many OEMs are now realizing that a poor post-sale experience and a lack of digital engagement can lead to losing up to 50% of customers.
Sales and Customer Management
Modern EV startups are leveraging Customer Relationship Management (CRM) systems to manage the entire sales process, from initial inquiry to final delivery. A CRM helps in plugging leaks in the sales funnel by ensuring speedy lead follow-ups, efficient test ride scheduling, and smooth financing processes.
Dealership Management System (DMS)
A Dealership Management System (DMS) is a software platform that helps OEMs and their dealers manage their operations seamlessly. This includes:
- Inventory Management: Tracking vehicles and spare parts in real-time across the entire network.
- Sales Operations: Managing leads, bookings, and sales transactions.
- Service and Spares: Handling job cards, service appointments, and warranty claims.
- Customer Engagement: Maintaining customer relationships and managing communications.
Software providers like Excellon, AutoDMS, and Auto Plus offer integrated DMS solutions tailored for the automotive industry, including the EV segment. These systems provide OEMs with a transparent view of their dealership network, allowing for better management and data-driven decisions.
Customer Complaint Management
An efficient complaint resolution system is vital for customer satisfaction. While traditional methods involve contacting the dealer, digital solutions are becoming more common.
- Automated Customer Care: For issues like public charging, where stations are often unmanned, automated solutions and 24/7 call support are crucial. These systems can guide new EV users through processes and troubleshoot common problems.
- Online Complaint Portals: Indian customers have legal protections under the Consumer Protection Act, 2019. They can file complaints online through the E-Daakhil portal for consumer disputes if they receive a defective EV. Some startups also have dedicated customer complaint forms on their websites.
After-Sales Service and Support
The post-sale experience is critical for retaining customers. Digital infrastructure plays a key role here.
- Integrated Asset Management: Solutions that offer lifecycle management for EV fleets, including real-time monitoring, service and repairs, and charging management, are becoming popular, especially in the B2B space.
- IoT-Driven Maintenance: Many EV startups use IoT (Internet of Things) technology to remotely monitor a vehicle’s health, perform predictive maintenance, and deliver seamless performance updates.
Why Digital Infrastructure is a Deciding Factor for Success
In the competitive Indian EV market, a strong digital infrastructure can be the difference between success and failure for a startup.
- Enhanced Customer Experience: A seamless digital journey, from online booking to after-sales support, builds trust and loyalty. Poor post-sale engagement is a primary reason why EV brands lose customers.
- Operational Efficiency: Integrated systems like DMS and CRM automate manual tasks, reduce errors, and provide real-time data, allowing the company to make faster, smarter decisions.
- Scalability: As a startup grows, a scalable digital framework can handle an increasing volume of sales, service requests, and customer data without breaking down.
- Brand Reputation: Quick and effective resolution of customer complaints through digital channels can significantly boost a brand’s reputation in a market where word-of-mouth is powerful.
- Data-Driven Insights: A robust tech infrastructure allows OEMs to collect and analyze vast amounts of data on vehicle performance, customer behavior, and dealer efficiency, which can be used to improve products and services.
Ultimately, investing in digital infrastructure is not just a cost but a strategic investment. For EV startups aiming to capture and retain market share, providing a superior digital experience is as important as building a great vehicle. Those who fail to do so will likely struggle to compete with more tech-savvy rivals.
Global Evidence and Studies Supporting Digital Infrastructure for OEMs
Several studies from around the world provide strong evidence that digital infrastructure is critical for automotive OEMs’ success:
Proven Impact on Profitability and Growth
A comprehensive research study published in the International Journal of Novel Research and Development found that digitalization can increase OEMs’ profitability and economic viability by 36.03%. The study also revealed specific benefits:
- Sales process digitization shows a 44% increase in sales
- After-sales services see a 14% improvement when fully digitized
- New business models experience an 8% growth through digitalization
McKinsey research indicates that the global automotive software and electronics market is expected to reach $462 billion by 2030, representing a 5.5% CAGR from 2019 to 2030. This massive growth signals that automotive companies without digital infrastructure will be left behind.
Risk of Not Digitalizing
The same study warns that OEMs that do not digitize risk losing 15% of their current profitability and a significant portion of their future opportunities. This is particularly concerning for startups that need every advantage to compete with established players.
A critical finding from an Accenture report cited in the research shows that even partial digitization won’t save OEMs in the long term – companies that stop short of full digitization have a low chance of succeeding.
Global Digital Infrastructure Investment Trends
The International Telecommunication Union (ITU) reports that digital infrastructure investment reached $63.4 billion globally in 2023, with $3.5 billion specifically channeled into specialist digital infrastructure vehicles. This massive investment underscores how seriously the global market takes digital infrastructure.
Why Digital Infrastructure is Critical for Fundraising
For EV startups seeking investment, digital infrastructure has become a deciding factor for investors. Here’s why:
Investor Preference for Tech-First Companies
Modern investors actively seek companies with scalable business models that can grow revenue without linearly increasing costs. Startups with digital infrastructure often rely on automation, recurring revenue models, and low customer acquisition costs – all hallmarks of scalable businesses.
A 2025 startup economics report found that 61% of early-stage companies are increasing their tech spend, with 73% significantly increasing spend on AI tools and technology. Companies embracing digital transformation showed dramatically different growth patterns:
- 3x more likely to be actively scaling their teams
- 2x more likely to be seeking larger funding rounds
- More likely to expand spend, hire faster, and deploy global contractor talent
Scalability and Growth Potential
Digital infrastructure provides the scalability that investors demand. As noted in investment research, scalability isn’t just about fast growth – it’s about smart growth. Cloud computing and digital systems allow businesses to scale effortlessly, increasing or decreasing resources based on demand without significant upfront investments.
For automotive startups, this means being able to handle rapid customer growth, manage larger dealer networks, and provide consistent service quality without proportionally increasing operational costs.
Competitive Advantage and Market Position
Investors gravitate toward startups that demonstrate clear technological advantages. A robust digital infrastructure signals to investors that the startup can:
- Respond quickly to market changes
- Maintain performance levels during growth phases
- Create barriers to entry for competitors
- Build sustainable competitive advantages
Data-Driven Decision Making
Digital infrastructure enables startups to collect and analyze vast amounts of data on vehicle performance, customer behavior, and market trends. This data-driven approach is highly valued by investors as it reduces investment risk and increases the likelihood of making informed strategic decisions.
Economic Impact and Future-Proofing
Research from various global studies shows that investment in digital infrastructure stimulates economic growth by creating jobs and fostering new business opportunities. For countries like India, a 10-point increase in digitization can yield a 74% increase in GDP per capita.
The COVID-19 pandemic served as a major catalyst, highlighting digital infrastructure’s countercyclical, inflation-hedging characteristics. This resilience makes digitally-enabled startups more attractive to investors seeking stable, long-term returns.
The Bottom Line for EV Startups
The evidence is clear: digital infrastructure isn’t just helpful for EV startups – it’s essential for survival and growth. Startups without robust digital systems face:
- 36% lower profitability potential
- 15% loss in current profitability if they fail to digitize
- Significantly reduced chances of attracting investment
- Limited scalability and growth potential
For investors, startups with strong digital infrastructure represent strategic investment opportunities that align with long-term market trends. These companies demonstrate the vision, scalability, and technological advantage that modern investors actively seek.
In today’s competitive landscape, digital infrastructure has evolved from a nice-to-have feature to a fundamental requirement for EV startup success. Those who invest early in comprehensive digital systems will not only survive but thrive, while those who delay may find themselves unable to compete or attract the funding needed for growth.