The Indian automobile industry delivered a strong performance in both Q4 (January–March 2026) and the full financial year FY2025-26, with all major vehicle segments — passenger vehicles, two-wheelers, three-wheelers and commercial vehicles — recording their highest-ever sales.
According to Society of Indian Automobile Manufacturers, the growth was supported by GST 2.0 reforms, repo rate cuts, improved affordability, stronger consumer sentiment, and rising electric vehicle adoption.
Segment-wise Performance
Passenger Vehicles
Passenger vehicle sales reached an all-time high of 13.16 lakh units in Q4 FY2025-26, growing 13.2% year-on-year. For the full year, sales stood at 46.43 lakh units, marking 7.9% growth over FY2024-25.
Growth was driven by improved affordability, tax relief, lower financing costs and strong demand in the second half of the year. Electric passenger vehicle registrations surged by over 80%, further boosting volumes. Exports also touched a record 9.05 lakh units, rising 17.5%, with steady demand from Middle East, Africa and Latin America.
Two-Wheelers
The two-wheeler segment recorded 57.73 lakh units in Q4, its highest-ever quarterly sales, with 26.4% growth.
For FY2025-26, sales reached 2.17 crore units, growing 10.7% and surpassing the previous peak of FY2018-19. Growth accelerated in the second half of the year due to GST reforms, tax relief and expectations of rising fuel prices, which also boosted EV adoption.
Exports reached a record 51.8 lakh units, up 23.4%, supported by strong global demand and favorable currency movements.
Three-Wheelers
Three-wheeler sales rose to 2.27 lakh units in Q4, registering 26.7% growth. Annual sales reached 8.36 lakh units, growing 12.8% year-on-year.
Growth was driven by rising economic activity, urban mobility demand and expansion of electric autorickshaws. Exports surged 50.1% to 4.61 lakh units, supported by strong demand from Sri Lanka and African markets.
Commercial Vehicles
Commercial vehicle sales reached 3.25 lakh units in Q4, up 18.9% year-on-year.
For FY2025-26, sales stood at 10.80 lakh units, growing 12.6%. Increased capital expenditure, lower financing costs and improved consumption demand helped drive fleet purchases. Exports grew 17.4% to 0.95 lakh units, with steady demand from neighboring countries and the Middle East.
Production and Sales Highlights
Q4 FY2025-26 (Jan–March 2026)
- Total production: 93.36 lakh units
- Passenger vehicles: 13.16 lakh units
- Commercial vehicles: 3.25 lakh units
- Three-wheelers: 2.27 lakh units
- Two-wheelers: 57.73 lakh units
FY2025-26 (April 2025–March 2026)
- Total production: 3.47 crore units
- Passenger vehicles: 46.43 lakh units
- Commercial vehicles: 10.79 lakh units
- Three-wheelers: 8.36 lakh units
- Two-wheelers: 2.17 crore units
Industry Outlook FY2026-27
Commenting on sales data of Financial Year 2025-26, Mr Shailesh Chandra, President, SIAM said, “Though FY 2025-26 started modestly, the Indian Auto industry has closed the year on a high note with every vehicle category viz. Passenger Vehicles, Commercial Vehicles, Three-Wheelers and Two-Wheelers, together posting their highest ever sales in a Financial Year, after seven years. The strong contributors to this growth have been the positive sentiments created through GST 2.0 reforms and multiple Repo Rate cuts during the year.
In FY 2025-26, Passenger vehicles posted sales of 46.43 Lakh units with a growth of 7.9%, Commercial Vehicles posted sales of 10.80 Lakh units with a growth of 12.6%, Three Wheelers posted sales of 8.36 Lakh units with a growth of 12.8%, and Two Wheelers posted sales of 2.17 Crore units, with a growth of 10.7%, over FY 2024-25.
Looking ahead, domestic demand and macroeconomic fundamentals remain robust as we step into FY 2026-27, which should aid steady growth for the industry. However, uncertainties arising from the West Asia conflict need to be closely monitored, as it may have impacts on production, commodity prices, fuel prices, freight rates and the overall economy.”
Commenting on the performance of Q4 (January to March) of 2025-26, Mr Rajesh Menon, Director General, SIAM said, “Each of the vehicle category, Passenger Vehicles, Commercial Vehicles, Three Wheelers and Two Wheelers posted their highest ever sales in the January to March Quarter with double digit growth compared to previous year’s quarter. In Q4 of 2025-26, Passenger Vehicles posted sales of 13.16 lakh units with a growth of 13.2%, Commercial Vehicles posted sales of 3.25 Lakh units with a growth of 18.9%, Three-Wheelers posted sales of 2.27 Lakh units with a growth of 26.7% and Two-Wheelers posted sales of 57.73 Lakh units with a growth of 26.4%, compared to Q4 of 2024-25.”
