TL;DR
India's automotive sector saw a strong 40.3% sales surge in October 2025, fueled by festive demand and GST rate cuts, with optimistic forecasts for continued growth.
The Indian automotive sector demonstrated robust performance in October 2025, driven by the festive season and improved affordability following the Goods and Services Tax (GST) rate rationalization. Overall automobile sales surged by 40.3% year-on-year in October, with growth across all segments, according to the Federation of Automobile Dealers Associations (FADA).
This buoyancy is also reflected in the stock market, where the BSE Auto Index delivered an 8.5% return over the past three months, outperforming the BSE Sensex. Analysts remain optimistic about sustained demand, citing favorable macroeconomic conditions, strong post-harvest rural cash flows, and seasonal marriage-related demand as key growth drivers.
While some analysts are adopting a cautious stance regarding the sustainability of demand, the medium-term outlook for the automotive sector remains robust. Key factors supporting continued growth include lower GST rates, reductions in personal income tax, a resurgence in replacement demand, and improving rural consumption.
