TL;DR
India's auto retail market saw strong growth in 2025, driven by improved consumer sentiment and GST 2.0, with optimism for continued momentum into 2026.
India's automobile retail market concluded the calendar year 2025 on a strong and confident note, as reported by the Federation of Automobile Dealers Associations (FADA). Total vehicle retail sales for CY'25 reached 2.81 crore units, marking a healthy year-on-year expansion. This robust performance was attributed to improving consumer sentiment, supportive policy measures, and strong year-end sales, despite a challenging start to the year.
The year 2025 saw two distinct phases, with the latter half experiencing a significant boost following the implementation of GST 2.0 rate rationalization. This policy adjustment led to reduced tax burdens on mass-market categories, including small cars, two-wheelers, three-wheelers, and key commercial vehicle segments, directly enhancing affordability and market sentiment. Looking ahead to January 2026, dealer sentiment remains optimistic, with expectations of continued growth, especially in the second half of the month, supported by the marriage season and ongoing rural demand.
