Retail sales across all segments of India’s automobile industry have risen by 28.6% year-on-year so far in July (July 1–23), according to a report released on Friday. The Choice Institutional Equities report noted a 31% year-on-year increase in two-wheeler sales, while passenger vehicle sales grew by 20.6%, driven by strong demand in the SUV and passenger car segments.
The report recorded year-on-year growth of 27.3% for commercial vehicles and 18.1% for three-wheelers. It also highlighted a robust 36.8% year-on-year rise in the tractor segment. “We expect the auto industry to register strong growth in July 2026,” the report stated, citing key factors such as the low base of July 2025, stable consumer sentiment, recently launched models, rapid adoption of electric vehicles, easing interest rates, and increased purchasing power following GST cuts.
The outlook for the coming months remains positive, driven by strong demand, a low base effect for August–September 2026, and an anticipated surge in demand due to the festive season in the latter half of the second quarter of FY 2026–27. Historically, the report noted, the last eight days of July account for approximately 25–28% of the month’s total sales.
Separately, another recent report projects that the operating revenue of India’s auto and auto-ancillary sector will grow by nearly 8% in FY 2026–27. According to the Brickwork Ratings report, the sector is entering a new investment cycle, with projects worth ₹70,300 crore likely to commence between FY 2026–27 and FY 2028–29.
The report states that this investment is backed by a pipeline of 184 projects worth ₹4.76 lakh crore and 70 projects already in the implementation stage. According to the report, this surge in investment is driven by Production Linked Incentive (PLI) schemes, FAME III incentives, and capacity expansion by Original Equipment Manufacturers (OEMs) and Tier-1 suppliers.
