TL;DR
India's automotive industry aims for record FY26 passenger vehicle sales, relying on strong rural demand and strategic price adjustments to counter slowing retail momentum.
The Indian passenger vehicle industry is aiming for a record 4.73 million unit sales in the fiscal year 2025-26, requiring an 8% year-on-year growth. Carmakers are preparing for a critical final quarter (January-March 2026) to achieve this ambitious target, contending with a recent slowdown in retail momentum, reduced household savings, and tighter lending conditions.
Despite these challenges, the industry is banking on robust rural demand, bolstered by a stable monsoon and strong crop output, which is driving replacement purchases for compact cars and entry-level SUVs. Price adjustments, including increases by leading manufacturers like Maruti Suzuki and Hyundai, are being implemented, with dealers maintaining lean inventories to facilitate a rapid sales push rather than relying on seasonal surges.
