TL;DR
ICRA forecasts a moderate 3-6% wholesale volume growth for the Indian automotive sector in FY2026-27, with passenger vehicles, two-wheelers, and commercial vehicles all contributing to the expansion, and EV adoption continuing to rise.
The Indian automotive industry is anticipated to experience a normalized wholesale volume growth of 3-6% across various segments in the fiscal year 2026-27, according to a recent report by ICRA. This projection follows a period of elevated growth observed in the latter half of 2025-26, which was largely driven by post-GST reform factors and a robust rural demand.
Breaking down the forecast, domestic passenger vehicle (PV) volumes are estimated to grow by 4-6% year-on-year, while the two-wheeler industry is expected to expand by 3-5% as growth moderates on an improved base. Commercial vehicle (CV) volumes are also projected for a 4-6% growth, propelled by economic activities and promising prospects within the bus segment. Over the medium term, the electrification of vehicles is expected to be a significant structural theme, with EV penetration steadily increasing across all segments.
