Auto retail defies post-festive lull as November sales hold strong, FADA projects robust growth ahead

THEBUSINESSBYTES BUREAU

NEW DELHI, DECEMBER 8, 2025

India’s automobile retail sector continued its resilient run in November 2025, defying the conventional post-festive cooldown and closing the month with a steady year-on-year growth of 2.14%. The Federation of Automobile Dealers Associations (FADA), releasing its latest Vehicle Retail Data on Sunday, said that despite an unusually high comparative base, the industry upheld momentum that signals both enduring consumer confidence and the structural strength of India’s auto retail ecosystem.

Commenting on the performance, FADA President C S Vigneshwar said that November 2025 broke traditional trends. Typically, sales lose steam after the festive cycle; however, this year’s retail dynamics shifted as the majority of festive purchases were completed in October. In contrast, Deepawali and Dhanteras in 2024 extended into late October and resulted in a sharp spike in November 2024 registrations. Despite the absence of a similar boost this year, the sector managed to hold ground, supported by GST rate cuts and competitive retail schemes offered jointly by OEMs and dealers. The price reductions that energized consumer sentiment in October continued to bolster conversions well into November.

Two-wheeler sales declined 3.1% year-on-year, but FADA emphasised that the dip must be viewed in the right context. A significant festive-driven shift to October, delayed crop payments, and uneven supply of certain preferred models contributed to the slowdown. Even so, dealers across several markets are witnessing healthy walk-ins, buoyed by positive GST sentiment and rising marriage-season demand.

Passenger vehicles posted an impressive 19.7% growth, driven by strong interest in compact SUVs, better availability of high-demand models, and continued benefits from GST cuts. With sustained footfall, inventory levels saw a meaningful correction, dropping from 53–55 days to 44–46 days — a sign of healthier demand-supply discipline returning to the market.

Commercial vehicles too clocked a robust 19.94% jump, aided by infrastructure activity, freight movement, tourism mobility and government tendering cycles. Although fleet utilisation varies across markets, GST reforms and stable freight sentiment supported the overall uptick.

Looking ahead, the near-term outlook remains promising. Rural sentiment is on an upswing as the rabi season begins strongly. Sowing has already crossed 39.3 million hectares — significantly ahead of last year — propelled by ample soil moisture, improved seed availability, and favourable MSP signals. Wheat, pulses, and oilseeds have recorded notable acreage gains, signalling improved farm incomes in the coming months. IMD’s forecast of a colder-than-normal winter across northern and central regions is also expected to support mobility needs and logistics activity. Together, these factors are creating early signs of recovery in FMCG, tractors, and rural two-wheeler categories.

Dealers remain cautiously positive as enquiry levels improve, marriage-season demand continues, and stock availability stabilises. Liquidity tied to crop realisations and the prospect of year-end consumer schemes are further strengthening the outlook. While some expect softness in urban premium segments, the broader industry tone suggests consolidating gains from recent GST-led affordability improvements and sustained retail traction over the past two months.

December sentiment, therefore, is best described as “cautious optimism,” as the industry watches calendar-year dynamics and supply patterns while benefiting from strong fundamentals and stable demand drivers.

FADA’s three-month forward outlook is even more encouraging. About 74% of dealers anticipate growth, reflecting broad-based confidence across segments. Expected price hikes in January, new model introductions for 2026, marriage-season demand, and liquidity from farm output are all poised to support robust retail activity. The government’s push through GST 2.0, the ‘One Nation, One Tax’ framework, and its ‘Viksit Bharat 2047’ mobility vision continue to boost affordability and vehicle penetration, especially in emerging markets.

Some moderation may occur due to model-year change sentiments and the absence of major festivities in January and February, yet the sector’s trajectory remains steady. With stable macroeconomic indicators, clearer farm income visibility, strong enquiry pipelines, and renewed confidence from both OEMs and dealers, India’s auto retail industry enters 2026 on a foundation of strengthened resilience and future-ready mobility ambition.