Auto Sales Decline: Q1 FY26 Shows 5.1% Drop Despite Utility Vehicle and PV Export Growth, ET Auto

PV exports hit an all-time Q1 high at 2.04 lakh units, up 13.2 per cent year-on-year, driven by demand from Latin America, the Middle East, Japan, and countries like Sri Lanka and Nepal.

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India’s automobile industry saw an overall sales decline of 5.1 per cent in the first quarter of FY26, as per data released by the Society of Indian Automobile Manufacturers (SIAM) on Monday. The drop was led by two-wheeler and passenger car segments, though growth in utility vehicles, PV exports and three-wheeler sales offered some relief.

Looking ahead, SIAM projects a cautious yet positive outlook for the second quarter, citing potential boosts from the festive season, normal monsoon and lower repo rates. However, challenges like rare-earth magnet supply restrictions from China could impact production.

Sales across segment

Passenger vehicle (PV) sales stood at 10.11 lakh units in April–June 2025, a marginal decline of 1.4 per cent year-on-year. While passenger car sales dropped 11.2 per cent, utility vehicles bucked the trend, rising 3.8 per cent and accounting for 66 per cent of the PV segment. Van sales remained largely flat.

The two-wheeler segment registered a 6.2 per cent drop to 46.74 lakh units, pulled down by motorcycles and mopeds. Motorcycles fell 9.2 per cent, mopeds dropped 10.9 per cent, while scooter sales remained stable with only a marginal 0.2 per cent dip.

Three-wheeler sales hit a record 1.65 lakh units in Q1 FY26, showing a marginal growth of 0.1 per cent. Passenger carriers drove this rise, while goods carriers and e-rickshaws reported declines.

Commercial vehicle (CV) sales dipped 0.6 per cent to 2.23 lakh units. However, medium and heavy passenger carriers saw a 6.6 per cent growth and LCV passenger carriers rose 8.8 per cent, reflecting resilience in the public transport segment.

Exports surge, especially for PVs and two-wheelers

PV exports hit an all-time Q1 high at 2.04 lakh units, up 13.2 per cent year-on-year, driven by demand from Latin America, the Middle East, Japan, and countries like Sri Lanka and Nepal. Two-wheeler exports also rose sharply by 23.2 per cent to 11.4 lakh units.

SIAM President Shailesh Chandra noted that overall sentiment remained subdued despite marginal gains in retail registrations. DG Rajesh Menon highlighted the flat industry performance and urged cautious optimism moving forward.>

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