FADA June ’25 Auto Retail Report & Q1 FY26 Insights: Volume Growth, Segment Trends & Near-Term Outlook

Explore FADA’s latest data on India’s auto-retail performance in June 2025 and Q1 FY26. Understand YoY growth across 2W, 3W, PV, CV, CE and Tractors; segment highlights; 

Q1 FY26 Auto-Retail Performance Overview

• Total volumes increased by 4.85% YoY, driven predominantly by:
  • Three-Wheelers (3W): +11.79% YoY
  • Commercial Equipment (CE): +10.59% YoY
• Other segment growth:
  • 2W: +5.02%
  • Passenger Vehicles (PV): +2.59%
  • Commercial Vehicles (CV): +1.00%
  • Tractors: +6.29%

June 2025 Auto-Retail Snapshot

• Total retail volumes up 4.84% YoY but declined 9.44% MoM.
• Segment-specific performance:
  • 2W: +4.73% YoY, -12.48% MoM
  • 3W: +6.68% YoY, -3.66% MoM
  • PV: +2.45% YoY, -1.49% MoM (inventory around 55 days)
  • Tractors: +8.68% YoY, +7.25% MoM
  • CE: +54.95% YoY, +44.98% MoM
  • CV: +6.60% YoY, -2.97% MoM

Segment Highlights

• Two-Wheelers: Early softness due to supply constraints, offset by festival & marriage season demand.
• Passenger Vehicles: Monsoon season and liquidity issues hampered conversions; elevated inventory levels.
• Commercial Vehicles: Strong YoY growth driven by early deliveries but tempered by infrastructure slowdown and new taxes.
• Tractors: Robust growth, supported by increased kharif sowing.
• CE & CV: Continued momentum from government capex in infrastructure, underpinning growth.

Near-Term Outlook (July 2025)

• Monsoon: Expected to exceed 106% of long-period average; rural demand likely to boost sales despite logistics challenges.
• Kharif Sowing: +11.3% YoY, indicating healthy hinterland activity.
• Government Capex: High investment in roads, rail, metro, green energy supports CV & CE.
• Risks & Headwinds:
  • Supply chain issues (e.g., rare-earth shortages, geopolitical tensions)
  • Dealer sentiment showing slowdown bias
  • Tepid enquiry pipelines
  • External factors: heavy rains, price hikes, variant shortages, high ownership costs

Dealer Sentiment & Survey Insights

• Liquidity & Sentiment: Approximately 50% neutral, 31% concerned about liquidity.
• July Expectations: 31% anticipate growth, 42.8% expect flat, 26% foresee de-growth.
• Booking Pipelines: Low enthusiasm across segments (2W: 21%, PV: 38%, CV: 32%).

Visualization & Data Visualization Notes

• The report includes visual analytics like:
  • Vehicle retail data trends (YTD & monthly)
  • Fuel-wise market share
  • Urban vs. rural retail strength
  • YoY & MoM category-wise comparisons
  • OEM market share shifts

Summary & Key Takeaways

• The Indian auto retail sector showed positive growth in Q1 FY26, particularly in the 3W, tractors, and CE segments.
• June 2025 retail activity remains strong YoY but faced some month-on-month softness, mainly in 2W.
• Dealer sentiment remains cautious, with signs of slowdown, underscoring the importance of monitoring demand signals closely.
• External factors like monsoon performance, government infrastructure investment, and supply chain challenges will significantly influence near- term performance.

Disclaimer:
This report is for informational purposes only and does not constitute investment advice before making decisions.