India's passenger vehicle sales hit record high on festive demand
What's the story
India's passenger vehicle (PV) wholesale sales hit an all-time monthly high of 460,739 units in October. The number is a 17% increase from last year and surpasses the previous record of 405,500 passenger vehicles sold in January 2025. The growth is mainly attributed to strong festive demand and price cuts by automakers following reduced goods and services tax (GST) rates.
Tax impact
GST rate reduction fuels automotive sales surge
The Indian government recently slashed taxes on passenger vehicles under four meters in length, two-wheelers with engine capacity less than 350cc, and commercial vehicles to 18% from the previous 28%. This has led to a significant increase in vehicle sales. Larger vehicles over four meters long are now taxed at a special rate of 40%, down from the earlier range of 43-50%, including compensation cess.
Market trends
2-wheeler and 3-wheeler sales also witness growth
Along with passenger vehicles, two-wheeler sales also saw a year-on-year (YoY) increase of 2.1% to a record 2.21 million units in October. While scooter sales rose by 14% to 824,003 units, motorcycle sales witnessed a slight decline of 4% to 1,335,468 units. Three-wheeler sales also increased by an impressive 5.9% to 81,288 units during the month under review.
Registration surge
October sees record vehicle registrations
Data from the Federation of Automobile Dealers Associations (FADA) shows that passenger vehicle registrations or retail sales hit a record 557,373 units in October. Two-wheeler retails also touched their highest-ever level for a month at 3,149,846 units. The spike in retails across these categories is attributed to pent-up demand, lower vehicle prices and strong consumer sentiments during the festive season.