Vehicle sales in India surpassed 60 lakh units in the first quarter of FY26, with Maharashtra and Uttar Pradesh leading the market across different segments, according to data from the Society of Indian Automobile Manufacturers (SIAM). Maharashtra emerged as the top state for car and truck sales, while Uttar Pradesh continued to dominate in the two-wheeler and three-wheeler segments.
“Uttar Pradesh has a largely rural landscape with limited access to public transportation, making motorcycles and three-wheelers the preferred mode of travel. This is why the state consistently records strong sales in these categories,” explained Vinkesh Gulati, former president of the Federation of Automobile Dealers Associations (FADA).
Maharashtra leads in car sales, Uttar Pradesh dominates two-wheeler market in Q1 FY26
Passenger vehicle sales in India crossed 10.12 lakh units in the April–June quarter of FY26, with Maharashtra emerging as the top-performing state, contributing nearly 12% of total sales at 1.19 lakh units. Uttar Pradesh followed closely with an 11.3% share, trailed by Gujarat (7.6%), Karnataka (7.2%), and Haryana (6.8%).
Analysts attribute Maharashtra’s lead to its higher purchasing power and urban lifestyle. “The state’s elevated standard of living is reflected in stronger demand for passenger cars,” noted Vinkesh Gulati, former president of the Federation of Automobile Dealers Associations (FADA). “On the other hand, Uttar Pradesh continues to excel in two- and three-wheeler sales due to its dense population and rural landscape.”
India’s two-wheeler segment—the backbone of its automobile industry—recorded 46.75 lakh units sold during the quarter. Uttar Pradesh led by a wide margin, accounting for 17.5% of all two-wheeler sales at 8.18 lakh units. Maharashtra followed with a 10.3% share, while Tamil Nadu (7.3%), Bihar (6.9%), and Madhya Pradesh (6.4%) rounded out the top five.
“Uttar Pradesh is a consumption-driven state where people are more inclined to spend rather than save. This consumer behavior supports strong demand for motorcycles and scooters,” said Hemal N Thakkar, Senior Practice Leader & Director at CRISIL.
Economic events, policy boosts drive vehicle sales surge in UP and Maharashtra
According to experts, economic activity and state-level incentives played a significant role in shaping vehicle sales trends in the first quarter of FY26. Hemal N Thakkar, Senior Practice Leader & Director at CRISIL, noted that events like the Maha Kumbh Mela had a notable ripple effect on the local economy. “The Kumbh Mela brought a surge of cash flow into Uttar Pradesh—from tea vendors and street hawkers to hotels and tourism operators. That liquidity eventually translated into higher vehicle demand, especially for two-wheelers,” he said.
Saurabh Agarwal, Partner at Ernst & Young, emphasized that Uttar Pradesh and Maharashtra reflect the diverse nature of India’s automotive market. “In UP, the economic uplift from the Kumbh Mela, combined with the state government’s waiver of registration fees on hybrid vehicles, significantly boosted two- and three-wheeler sales. Maharashtra, on the other hand, continued to lead thanks to its robust economy—driven by high GST collections, strong consumer spending, and major infrastructure projects like expressways that are enhancing connectivity,” he explained.
The three-wheeler segment, vital for last-mile urban transport, saw sales rise to 1.65 lakh units during the quarter. Uttar Pradesh once again topped the charts with 13% of the market, selling over 21,000 units. Maharashtra followed with an 11.5% share, while Gujarat and Karnataka recorded 9.4% and 8.9%, respectively.
Commercial Vehicle sales reflect state economies; overall market dips 5% in Q1 FY26
Commercial vehicle sales in India reached 2.23 lakh units in the first quarter of FY26, following similar regional trends seen across other vehicle categories. Maharashtra led the segment with 14.2% of total sales, accounting for 32,188 units. It was followed by Uttar Pradesh at 8.6%, Tamil Nadu at 8.5%, Gujarat at 7.9%, and Rajasthan at 6.5%.
“Truck sales have seen a notable uptick in Maharashtra, largely due to the concentration of industrial and manufacturing hubs in regions like Nashik and Pune,” said Vinkesh Gulati, former president of the Federation of Automobile Dealers Associations (FADA). “Commercial vehicle demand is closely linked to manufacturing activity—wherever production thrives, so does demand for transport.”
Despite strong performances in select states, overall vehicle sales declined by about 5% year-on-year, according to the Society of Indian Automobile Manufacturers (SIAM). “This quarter has been challenging. Vehicle dispatches dropped by around 5% compared to the same period last year,” Gulati noted. “We’re seeing weak consumer sentiment and broader economic concerns—including global issues like U.S. tariffs and rare earth supply disruptions—weighing on demand.”
Looking ahead, Gulati emphasized the importance of key factors such as potential GST revisions, the upcoming festive season, and shifts in rural consumer sentiment in shaping market recovery.
