Passenger vehicle retail sales in India saw a 7% increase in January compared to the previous year, with wholesale volumes also rising by 12% to 4.5 lakh units, as per a report. The report highlighted that wholesale dispatches grew by 14% compared to December 2025, with manufacturers increasing production to meet strong domestic demand. Looking ahead, forecasts suggest a 5–7% expansion in passenger vehicle wholesale volumes for the fiscal year 2026, driven by sustained demand, GST reductions, and new model introductions.
Domestic demand for automobiles, particularly in the two-wheeler and passenger vehicle segments, showed robust growth in January 2026. This growth was supported by factors such as sustained demand momentum, GST rate cuts, wedding season demand, and the launch of new models. Despite production constraints for annual maintenance, wholesale volumes posted a significant 14% sequential growth in January, while retail sales benefited from the winter wedding season, new model releases, and revised GST rates.
In the first ten months of fiscal year 2026, overall passenger vehicle wholesale growth stood at 6.7%, with retail volumes growing by 8%. The domestic automobile industry is expected to maintain a steady growth trajectory in fiscal year 2026, driven by various factors including policy initiatives to boost domestic manufacturing, enhanced affordability post-GST rationalization, consumption recovery, and sustained rural income levels following a normal monsoon.
Meanwhile, domestic two-wheeler wholesale volumes surged by 25% year-on-year, reaching 1.8 million units, with a 6.7% growth in wholesale volumes recorded during the ten months of fiscal year 2026. Retail sales for two-wheelers witnessed a 20.8% year-on-year growth in January, supported by demand during Pongal or Makar Sankranti, the wedding season, and increased affordability. Looking ahead, estimates indicate a 6–9% year-on-year growth in domestic two-wheeler volumes for fiscal year 2026, driven by factors such as improved replacement demand post-GST rate cuts, urban consumption recovery, and healthy rural incomes.
In January, electric two-wheeler retail volumes reached 1,23,012 units, marking a 25.3% year-on-year increase.
