In a first, alternative fuels overtake petrol in India’s car market
In a historic shift for India’s automobile market, alternative fuels — CNG, hybrid and electric combined — outsold petrol cars in the passenger vehicle segment for the first time ever.
According to the Federation of Automobile Dealers Associations (FADA), alternative fuels accounted for 41.95% of passenger vehicle retail sales in August 2026, edging past petrol’s 40.85% share. A little over a year ago, petrol led this contest by nearly 11 percentage points.
The breakdown shows CNG/LPG led the surge at 25.28%, followed by hybrids at 9.04% and EVs at 7.63%. Diesel made up the remaining 17.21%. Petrol, however, remained the largest single fuel type.
FADA said the shift reflected lower running costs and consumer uncertainty over the transition to E20 petrol — petrol blended with 20% ethanol — which has raised concerns about mileage and engine performance in older vehicles.
The milestone came during India’s biggest-ever August for auto retail. Total vehicle sales rose 17.51% year-on-year to 24,23,201 units, driven by record August numbers for two-wheelers, passenger vehicles and commercial vehicles.
Passenger vehicles alone retailed 4,02,398 units, up 16.14% YoY, crossing the 4-lakh mark for an August for the first time.
On a month-on-month basis, however, sales fell 6.48% from a record July, due to a seasonal monsoon lull and a festival calendar that shifted Ganesh Chaturthi and the spillover of Onam buying into September, FADA said.”The defining development of the month was a structural one,” FADA President Sai Giridhar said.
