Passenger vehicle retail sales jump 32.1% to record 4.27 lakh units in September; overall auto retail hits best-ever month: FADA

Passenger Vehicle (PV) retail sales in India jumped 32.10% year-on-year to a record 4,27,213 units in September 2026, according to the Federation of Automobile Dealers Associations (FADA), as demand strengthened ahead of the festive season. PV retail sales also rose 6.17% month-on-month from 4,02,398 units in August, marking the segment’s best-ever September.

The broader automobile retail market also recorded its best-ever September, with total registrations rising 31.82% YoY to 25,36,920 units, up 4.69% from August. FADA President Sai Giridhar cautioned that the headline growth was partly influenced by a distorted base, as buyers had deferred purchases in September 2025 ahead of the implementation of GST 2.0.

“The cleaner signals are three. It was the best-ever September across five of our six categories, retail rose 4.69% over August; and even setting the distorted September aside, FY27’s first five months grew about 17%,” he said.

Two-Wheelers, CVs drive broad-based retail growth

Two-Wheeler retail sales rose 33.08% YoY to 17,90,188 units, up 4.41% sequentially, marking the segment’s best-ever September. Rural and Urban markets grew almost evenly on a YoY basis, while Urban demand led the festive recovery on a monthly basis. Giridhar said the segment benefited from festive buying, steady rural and semi-urban demand, a shift towards premium motorcycles and accelerating EV adoption. “2W EV share touched 11.58%,” he said, while noting that Shraadh-related deferment and supply shortages in fast-moving models tempered the growth.

Commercial Vehicle (CV) retail sales crossed the one-lakh mark for the first time in a September, rising 37.62% YoY and 14.09% MoM to 1,03,557 units. Heavy Commercial Vehicles led the segment with a 46.22% YoY increase. Giridhar attributed the momentum to replacement demand, infrastructure and mining activity, bulk fleet purchases for steel and cement movement, higher rural incomes and purchases ahead of October price increases.

Three-Wheelers, EVs add momentum; Tractors remain soft spot

Three-Wheeler retail sales increased 22.25% YoY to 1,32,570 units, their best-ever September, with EVs accounting for 64.90% of sales. Wheeled Construction Equipment retail also rose 38% to 6,486 units, reflecting a festive-led rebound.

Tractors were the only category to decline sequentially, with retail sales falling 12.58% MoM to 76,906 units, although they remained 13.75% higher YoY. FADA attributed the decline to the later festive calendar and patchy monsoon.

EV retail hits record; PV fuel mix remains closely contested

Total EV retail sales across categories touched an all-time monthly high of around 3.34 lakh units, taking overall EV penetration to roughly 13%. PV EV penetration rose to a fresh high of 8.45%, while petrol/ethanol accounted for 41.27% of PV sales against 41% for alternative fuels. “Petrol and alternative fuels are now effectively at parity, trading the lead month to month, even as EV share rose to a fresh high and CNG eased,” Giridhar said.

FADA said PV inventory had risen to 43–45 days, well above its recommended 21-day level. Giridhar said affordability would be critical through the festive season, warning that further price increases could erode the gains from GST 2.0.

“Protecting the GST gain is, to our mind, the key to converting the festive season into durable growth,” he said.

For October, 75.57% of dealers expect growth, while 78.28% expect growth during October-December, setting up the festive quarter as the next major test for India's automobile retail market