ICRA has reported year-over-year growth in wholesale and retail volumes for the passenger vehicle industry in November 2025, driven by sustained post-festive demand, GST rate cuts, and the winter wedding season. Retail sales grew 22% YoY but declined 29% from October’s festive peak, while wholesale volumes increased 19% YoY to 4.1 lakh units as OEMs maintained production to meet demand.
For the first eight months of FY2026, wholesale growth stood at 3.6% YoY compared to 6.1% for retail sales, indicating a gap between production and consumer demand patterns.
Inventory levels showed improvement, declining to 44-46 days by November 2025 from 60 days at end-September, according to Federation of Automobile Dealers Association (FADA) data. The reduction in inventory was supported by stronger retail offtake across dealerships.
Utility vehicles maintained a dominant position, holding 67% share of passenger vehicle volumes in November, down marginally from 69% in October. The mini, compact, and super-compact segments showed revival following the implementation of GST cuts. ICRA expects utility vehicles to continue leading the market, with recovery anticipated in passenger car demand as the impact of tax reductions filters through to consumers.
The export segment demonstrated robust performance, with volumes surging 40% YoY in November, albeit on a low base from the previous year. For the eight months of FY2026, exports grew 19%, led by Maruti Suzuki India Limited and Hyundai Motor India Limited. The growth reflects increased supply push by OEMs targeting international markets.
ICRA forecasts FY2026 wholesale volume growth in the range of 1-4%, supported by multiple factors including steady domestic demand, the positive impact of GST rate cuts on pricing, new model launches across segments, and sustained momentum from the festive and wedding seasons. The outlook remains cautiously optimistic as the industry balances production with retail absorption.
The November performance underscores the passenger vehicle industry’s resilience despite seasonal fluctuations, with government policy support through tax cuts playing a role in stimulating demand across vehicle segments.