Our Terms & Conditions | Our Privacy Policy
Automobile sales growth slowed to 6% in FY25 due to factors like market uncertainty, high costs, and consumer hesitation. The shift towards electric vehicles and limited launches contributed to the slowdown.
The growth in automobile market slowed in FY25, with sales rising by 6% to 26.1 million units, as compared to a robust 10% increase in FY24, with sales jumped to 24.6 million from 22.3 million, according to latest Vahan data.
Sector experts attributed the downturn to a variety of factors, including subdued market confidence, limited cash flow, a high base effect, and rising costs, in addition to consumers postponing purchases while awaiting new electric vehicle (EV) launches.
The slowdown is projected to continue in FY26, with predictions suggesting only single-digit growth. “Post-Covid, the economy experienced an upswing in FY24, but now the market is contracting, and the anticipation of an economic slowdown is clouding customer purchasing decisions, leading to a reluctance to spend as freely as they did in FY24,” a sector expert explained. “The trend is likely to continue in FY26,” the expert added.
Both the passenger vehicle and three-wheeler segments experienced growth below the industry average. The three-wheeler (3W) segment saw a 4.3% increase, while passenger cars grew by 4.5%, compared to the overall industry growth of 5.9%. Sales in the 3W segment rose to 1.22 million units from 1.17 million, and the passenger car segment increased to 4.1 million units from 3.9 million.
The modest growth in the industry was primarily driven by a surge in two-wheeler purchases. The two-wheeler (2W) segment recorded a 7% rise in FY25, with sales climbing to 18.8 million units from 17.6 million.
The numbers do not include data from Telangana and Lakshadweep.
In the fuel mix, the EV segment drove record sales, with electric vehicle sales reaching 1.95 million units compared to 1.68 million in FY24. In contrast, petrol vehicle sales grew by only 4%, increasing from 18,351,126 units in FY24 to 19,085,423 units.
Market analysts also noted a shift in consumer preferences toward more fuel-efficient and electric vehicle options, contributing to the sluggish growth in the segment. Customers are holding off on purchases, awaiting recently launched models such as Honda’s electric Activa or Maruti Suzuki’s e-Grand Vitara.
“Customers are hesitant to invest in vehicles right now and are becoming more cautious in their choices. They’ve observed recent EV launches from companies like Honda, Maruti Suzuki, and Mahindra & Mahindra, which has led them to delay their purchase decisions,” an expert remarked.
Automobile manufacturers have also scaled back new launches as they pivot toward greener fuel alternatives, prompting customers to wait for a broader range of options in the coming months.
Discover the latest in the auto world with new cars and new bikes, explore upcoming cars in India, and find your perfect match with cars under 5 lakh, 10 lakh or 15 lakh. Stay updated with the latest auto news and the rise of electric vehicles.
This article was first uploaded on March thirty-one, twenty twenty-five, at three minutes past ten in the night.
Images are for reference only.Images and contents gathered automatic from google or 3rd party sources.All rights on the images and contents are with their legal original owners.
Aggregated From –
Comments are closed.