Business Economy


Indian auto sector shows resilience amid Q1 headwinds

Mumbai, July 15 (UNI) India's automotive sector delivered a mixed performance during the first quarter of FY2025-26, with most segments registering marginal declines despite record achievements in select categories, according to Society of Indian Automobile Manufacturers (SIAM) data released here today.
Passenger vehicle sales dipped 1.4% year-on-year to 1.01 million units, though crossing the million-unit threshold for the second consecutive Q1.
The segment witnessed divergent trends: utility vehicles grew 3.8% to command 66% market share, while passenger cars declined 11.2%. Exports surged 13.2% to 204,000 units - a quarterly record - fueled by Middle Eastern, Latin American, and emerging market demand under preferential trade agreements.
Two-wheeler wholesales fell 6.2% to 4.67 million units amid industry-wide inventory corrections, despite 5% retail growth driven by wedding season demand. Scooters gained 2.15% market share within the segment, while exports jumped 23.2% to 1.14 million units on revived neighboring markets.
Three-wheelers emerged as the standout performer, achieving historic Q1 sales of 165,000 units with 0.1% growth. Urban transport demand boosted passenger carriers, while cargo variants rode intracity logistics growth supported by easier financing. Exports soared 34.4% to 96,000 units.
Commercial vehicle sales declined marginally by 0.6% to 223,000 units.
"While three-wheelers achieved their highest-ever Q1 performance, other segments faced headwinds," stated SIAM Director General Rajesh Menon, noting passenger vehicles and two-wheelers contracted 1.4% and 6.2% respectively.
Industry leaders express cautious optimism for Q2, banking on festive season demand, potential rural recovery from forecasted above-normal monsoons, and improved affordability from the Reserve Bank of India's 100-basis-point cumulative rate cuts. Supply chain concerns persist, particularly regarding China's new export controls on rare earth magnets critical for EV manufacturing.
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