India’s retail automobile market recorded strong growth in February, with vehicle sales rising 25.62 percent year-on-year to 24.09 lakh units, according to data released by the Federation of Automobile Dealers Associations (FADA). The figures surpassed the previous sales record achieved in February 2024, reflecting robust demand across the country.
Strong Performance Across Vehicle Segments
The increase in retail sales was observed across most vehicle segments, highlighting rising consumer demand as well as expanding economic activity.
-
Two-wheelers: Sales grew by 25.02%
-
Three-wheelers: Increased by 24.39%
-
Passenger vehicles: Rose by 26.12%
-
Commercial vehicles: Registered growth of 28.89%
The data indicates that both personal mobility and vehicles used for commercial operations are witnessing strong demand in the market.
Positive Market Outlook for March
FADA noted that dealer sentiment for March remains largely optimistic.
Nearly 75.51 percent of dealers expect sales to rise further, while 19.90 percent anticipate stable demand. Only 4.59 percent of dealers believe sales could decline in the coming month.
Tractor Segment Records Highest Growth
Among all categories, the tractor segment emerged as the fastest-growing, registering a 36.35 percent increase in February. This growth is largely supported by strong rural demand and positive agricultural conditions.
However, the construction equipment segment was the only category that did not register a new record, reporting a slight 1.22 percent decline compared to the previous year.
Policy Support Boosting Consumer Confidence
According to FADA, the strong performance of the automobile sector indicates that confidence generated by government policies is gradually translating into higher demand.
The association noted that market stability and improved consumer sentiment after changes in GST 2.0 have contributed to sustained demand across vehicle categories.
Two-Wheeler Sales Cross 17 Lakh Units
Retail sales of two-wheelers reached 17,00,505 units, marking a 25.02 percent increase year-on-year.
Dealers attribute this growth to several factors, including a good agricultural season, improved liquidity in rural markets, attractive promotional schemes, and better pricing following GST adjustments.
Commercial Vehicle Sales Driven by Economic Activity
Sales of commercial vehicles rose to 1,00,820 units in February, reflecting a 28.89 percent increase compared to the previous year.
Industry dealers pointed to higher freight movement, stable e-commerce demand, and growing infrastructure activity as key drivers behind the rise in commercial vehicle purchases.
Rural Demand Fuels Passenger Vehicle Growth
Passenger vehicle retail sales stood at 3,94,768 units, registering a 26.12 percent increase year-on-year.
Urban markets saw a 21.12 percent rise, while rural markets recorded a stronger growth of 34.21 percent, highlighting increasing vehicle demand in smaller towns and villages.
The report also noted that while SUVs and utility vehicles continue to dominate the market, rising rural demand is providing significant support to the small car segment.
