Auto sales rise in October as industry picks up momentum due to GST cut and festive season

The full impact of the recent GST rate cut was witnessed with the festive season in October 2025, leading to a comprehensive recovery in the automobile industry. Strong performance in the commercial vehicle segment and steady demand in passenger vehicles and two-wheelers led to solid wholesale figures for automakers in the month.

Commercial vehicles outperformed other categories during the month. Tata Motors reported 10% year-on-year growth in CV sales, while Ashok Leyland reported 16% growth against an estimated 11%. The company’s bus business, which was previously performing poorly, turned around with 34% growth in sales due to improvement in fleet demand and infrastructure spending.

Passenger vehicle sales were largely in line with expectations. Growth continued to be driven by SUVs, while the entry-level segment remained weak despite GST benefits. Maruti Suzuki’s overall sales grew by 7%, compact car sales by 16% and SUV sales by 10%.

Mahindra & Mahindra reported 31% year-on-year growth in SUV sales, its highest ever monthly growth, supported by new product launches. Tata Motors reported 27% growth in its passenger vehicle segment due to strong SUV demand.

In the two-wheeler segment, wholesales remained stable after softening in H1FY26. Eicher Motors and TVS Motor performed better with growth above the industry average, while Bajaj Auto sales were broadly in line but growth remained slow.

At the retail level, vehicle registration data indicated continuation of the festive momentum. Registrations for passenger vehicles have increased by 23% and for two-wheelers by 22% since Navratri.

Compared to the period after Ganesh Chaturthi, the growth stood at 11% and 12% respectively. The full impact of Diwali sales is expected to be visible in vehicle data around November 8. If current trends continue, the industry is likely to meet its volume projections for FY2026.

Performance in the electric two-wheeler sector was mixed. Ola Electric performed poorly, slipped to fourth place in terms of market share. Its registrations declined by 62% year-on-year, but increased by 20% month-on-month, with average monthly registrations in 2025 standing at 18,000 units compared to 34,000 in 2024.

Ather Energy, which ranked third by market share, recorded strong growth with registrations up 73% year-on-year and 54% month-on-month. Its average monthly registrations are expected to increase from 10,000 units in 2024 to 16,000 units this year.