Automobile Retail Sales Rise 6% In FY25

New Delhi: Automobile retail sales in India rose 6 per cent to 2,61,43,943 units in FY25 with rural areas performing better than urban regions across passenger vehicle and two-wheeler segments, dealers' body FADA said on Monday.

The last financial year saw growth in sales of passenger vehicles, two-wheelers and three-wheelers. Registrations of commercial vehicles and tractors however saw a dip in FY25 as compared to FY24. Overall retail sales stood at 2,45,58,437 units in the 2023-24 fiscal. As per FADA, passenger vehicle retail sales witnessed an increase of 5 per cent to 41,53,432 units last fiscal as compared to 39,60,602 units in FY24.

Two-wheeler registrations rose 8 per cent to 1,88,77,812 units as compared to 1,75,27,115 units in 2023-24 fiscal. "FY25 truly showcased how adaptable and resilient India's auto retail sector can be... Key highlight this year was the strong performance in rural areas," FADA President C S Vigneshwar said in a statement. In the two-wheeler space, rural markets grew by 8 per cent, comfortably outpacing the urban growth, he added. In the passenger vehicle vertical, rural sales growth stood at 8 per cent as compared to 3 per cent in urban areas, he said. Three-wheeler sales rose 5 per cent to 12,20,981 units last fiscal as compared to FY24.

Three-wheelers saw a rural growth of 9 per cent last fiscal as compared to flat sales growth in cities. Commercial vehicle sales declined marginally to 10,08,623 units last fiscal as compared to 10,10,324 units in the 2023-24 fiscal. Tractor sales declined 1 per cent year-on-year to 8,92,410 units last fiscal as against 8,83,095 units in FY24. The industry body said that dealers across India are cautiously optimistic looking ahead to FY26, with FADA projecting mid- to high single-digit growth in the two-wheeler segment and low single-digit growth for both PV and CV segments.

Many dealers pin their hopes on a combination of upcoming model launches and renewed interest in electric vehicles, it said. "Yet, significant headwinds dampen overall optimism. Financing remains a persistent challenge ...dealers note that credit norms have tightened in recent months, and the need for further rate cuts by the RBI to bring down borrowing costs," it added. Adding to the uncertainty is the looming spectre of a global tariff war, which could spark stock market turbulence and erode returns on mutual fund SIPs, FADA said.