India’s Electric Two-Wheeler Sales Surge By A Third In May Amid A China Threat

TVS Motor Co. Ltd. has emerged as India’s largest electric two-wheeler maker for a second straight month, even as the wider industry grew by a third. That outperformance could scupper in just two months due to a China threat.

Sales of electric two-wheelers rose 29.65% year-on-year to 1,00,266 units in May 2025 as TVS, Bajaj Auto Ltd. and Ather Energy Ltd. doubled volumes and Ola Electric’s halved, according to VAHAN data at 10:00 am on 1 June.

“While EV sales continue to grow steadily, disruptions in the EV supply chain, particularly concerning magnet availability, are expected to pose challenges in the short- to medium term,” TVS said in an exchange filing.

In April, China suspended the exports of critical rare earth elements, metals and magnets in response to US President Donald Trump’s tariff war against Beijing. The move has crippled the supply chain for electronics to automobiles and aerospace.

China now requires importers to submit an application detailing the end-use of rare earth magnets, with assurance that the materials won’t be used in military applications or routed to the US, according to Bloomberg. The process must be initiated by the importer, then endorsed by China before a final clearance.

The issue was addressed by Bajaj Auto in its latest earnings call.

“The rare earth situation is a difficult one,” Rakesh Sharma, executive director at the Chetak maker, said during a post-earnings conference call. “Supplies and stocks are depleting fast. If there’s no relief (from the export curbs), production will be seriously impaired in July. That’s the current case for the automobile industry.”

Indian companies have submitted 30 such applications, none of which have been approved so far, Sharma had said. “There’s a very onerous process we have hammered together, but the flow has simply not started.”