TL;DR
India's two-wheeler sector expects 6-9% growth in 2026, fueled by GST cuts and urban demand, but faces potential price hikes due to a proposed ABS mandate.
The Indian two-wheeler industry is projected to achieve a 6-9% growth in the calendar year 2026, primarily driven by enhanced affordability following the reduction in Goods and Services Tax (GST) from 28% to 18% and a recovery in urban demand. This positive outlook, however, is tempered by a proposed mandate to make Anti-lock Braking Systems (ABS) compulsory for sub-125cc two-wheelers.
Analysts estimate that integrating an entry-level ABS system could increase vehicle prices by ₹2,000-₹5,000 per unit, potentially impacting near-term sales volumes in the price-sensitive entry-level segment. Despite these potential cost pressures, the industry remains cautiously optimistic, banking on improved consumer sentiment and a sustained demand for vehicle replacements, especially in urban areas.
