India’s auto retail market began calendar year 2026 on a strong footing, with overall vehicle retail rising 17.61% YoY to 27.22 lakh units in January, driven by healthy rural cash flows, post-GST momentum, and sustained demand across personal mobility and freight segments, according to FADA data.
January 2026 Retail Performance (YoY)
- Two-Wheelers: 18,52,870 units | +20.82%
- Passenger Vehicles: 5,13,475 units | +7.22%
- Commercial Vehicles: 1,07,486 units | +15.07%
- Three-Wheelers: 1,27,134 units | +18.80%
- Tractors: 1,14,759 units | +22.89%
- Construction Equipment: 6,834 units | -21.09%
Retail demand in January was supported by strong rural liquidity from harvest and wedding-season spending, post-GST affordability benefits, and steady freight movement. Dealer feedback highlighted strong enquiry momentum, sharper customer engagement, faster digital follow-ups, and a visible shift towards higher-value models.
Key challenges included selective supply constraints, aggressive competitive discounting, and high-base effects in certain categories.
Two-Wheelers (2W):
Two-wheelers led overall growth, with rural markets accounting for ~56% of volumes. While rural demand remained robust (+19.77% YoY) on the back of Pongal/Makar Sankranti and marriage-season footfalls, urban markets showed a healthy revival (+22.19% YoY)—signalling demand normalisation beyond festive-only buying. Improved affordability and growing preference for mid-powered and premium motorcycles supported growth.
Passenger Vehicles (PV):
PV retail grew 7.22% YoY, with the segment still urban-led (~59%). However, growth momentum was clearly stronger in rural and non-metro markets, where volumes rose 14.43% YoY, compared with 2.75% YoY in urban areas. Demand was driven by SUV and compact-SUV preference, revival in entry-level models, better availability, and continued schemes. PV inventory levels eased to ~32–34 days, indicating healthier channel discipline.
Commercial Vehicles (CV):
CV retail rose 15.07% YoY, reflecting improving freight sentiment and replacement-led buying. LCVs grew 14.94% YoY, while HCVs increased 14.61% YoY, supported by goods movement, infrastructure activity, and renewed confidence among single-owner operators. Both rural and urban markets contributed, underlining broad-based logistics demand.
Commenting on the performance, FADA President Mr. C. S. Vigneshwar said January 2026 delivered a strong and broad-based start to the year, powered by rural cash flows, post-GST momentum, and sustained visibility across mobility and freight. While most segments performed well, Construction Equipment remained under pressure due to high-base impact and segment-specific recalibration.
Near-Term Outlook (February 2026)
Dealer sentiment remains positive, with over 72% of dealers expecting growth. A pro-growth Union Budget focused on infrastructure and agriculture, ongoing wedding-season demand, and stable interest rates continue to support affordability and buying intent. However, the shorter month, a high base effect, localised election-related disruptions, and selective supply constraints remain key watch-outs.
Three-Month Outlook (February–April 2026)
Looking ahead, dealer confidence remains guardedly optimistic, with nearly 80% of respondents anticipating growth. Structural demand expansion beyond metros, resilient rural fundamentals, and healthy booking pipelines are expected to sustain momentum across segments. While passenger vehicles and commercial vehicles are likely to close FY26 on a strong note, a degree of normalisation is anticipated post-March as festive tailwinds taper and base effects come into play.
All India Vehicle Retail Data for FY’26 YTD (Apr’25 to Jan’26)
| CATEGORY | YTD FY’26 | YTD FY’25 | Growth % |
| 2W | 1,77,50,499 | 1,60,13,199 | 10.85% |
| 3W | 11,36,501 | 10,27,347 | 10.62% |
| CV | 8,56,834 | 7,82,056 | 9.56% |
| CE | 57,313 | 65,607 | -12.64% |
| PV | 38,45,801 | 34,88,523 | 10.24% |
| TRAC | 8,78,389 | 7,43,233 | 18.18% |
| Total | 2,45,25,337 | 2,21,19,965 | 10.87% |
Source: FADA Research
All India Vehicle Retail Data for Jan’26
| CATEGORY | Jan’26 | Dec’25 | Jan’25 | MoM% | YoY% |
| 2W | 18,52,870 | 13,16,891 | 15,33,556 | 40.70% | 20.82% |
| 3W | 1,27,134 | 1,27,772 | 1,07,013 | -0.50% | 18.80% |
| E-RICKSHAW(P) | 44,456 | 57,478 | 38,822 | -22.66% | 14.51% |
| E-RICKSHAW WITH CART (G) | 7,656 | 7,607 | 5,744 | 0.64% | 33.29% |
| THREE-WHEELER (GOODS) | 14,199 | 11,214 | 12,047 | 26.62% | 17.86% |
| THREE-WHEELER (PASSENGER) | 60,701 | 51,363 | 50,313 | 18.18% | 20.65% |
| THREE-WHEELER (PERSONAL) | 122 | 110 | 87 | 10.91% | 40.23% |
| PV | 5,13,475 | 3,79,671 | 4,78,915 | 35.24% | 7.22% |
| TRAC | 1,14,759 | 1,15,001 | 93,386 | -0.21% | 22.89% |
| CE | 6,834 | 5,820 | 8,660 | 17.42% | -21.09% |
| CV | 1,07,486 | 83,666 | 93,410 | 28.47% | 15.07% |
| LCV | 65,505 | 49,251 | 56,991 | 33.00% | 14.94% |
| MCV | 7,648 | 6,411 | 6,434 | 19.29% | 18.87% |
| HCV | 34,287 | 27,941 | 29,915 | 22.71% | 14.61% |
| Others | 46 | 63 | 70 | -26.98% | -34.29% |
| Total | 27,22,558 | 20,28,821 | 23,14,940 | 34.19% | 17.61% |
Source: FADA Research
