Key Highlights from Q2 (July–September 2026)
a) Passenger vehicles
· Passenger Vehicle sales stood at 1.36 million units in Q2 of 2026–27, registering a growth of 30.7% compared to Q2 of 2025–26.
· The Utility Vehicle (UV) sub-segment continued to dominate the PV market, accounting for 68% of total PV sales. UV sales grew by 34.2% in Q2 of 2026-27, compared with Q2 of 2025-26. Passenger car sales also recorded a strong double-digit growth rate of 24.9% during the quarter.
· Improved affordability post GST 2.0, lower base of last year, new vehicle technologies including alternate fuels and EVs besides strong financing support have helped impressive growth of passenger vehicles. With rural demand holding and the festive off take being healthy, passenger vehicles sales have registered healthy growth.
· Passenger Vehicle exports stood at 2.29 lakh units in Q2 of 2026–27, representing a (-) 5.2% decline compared with the same period last year, primarily due to higher base and logistics constraints due to West Asia crisis.
b) Two-Wheelers
· The Two-Wheeler segment posted sales of 6.43 million units in Q2 of 2026–27, registering a growth of 15.2% over Q2 of 2025–26.
· Two-wheeler growth in Q2 was supported by a low base, improved affordability following GST 2.0, and an emerging replacement cycle across markets with varying penetration levels.
· Growth was led by the scooter sub-segment, which grew by 27.7% in the quarter compared with the same period last year, while the motorcycle sub-segment recorded growth of 7.4%.
· Two Wheelers recorded their highest ever exports of Q2 in 2026-27, reaching 1.65 million units registering a growth of 27.7% over Q2 of 2025-26.
c) Three Wheelers
· In Q2 of 2026-27, Three-Wheelers posted sales of 2.85 Lakh units, with a growth of 23.6%.
· 3W domestic growth was driven by the post-GST reform step-up in ICE three-wheelers, the shift toward higher-quality L5 electric vehicles, and robust growth in the cargo three-wheeler segment across fuel types. This was supported by increased last-mile mobility demand and the segment’s favourable total cost of ownership.
· 1.6 Lakh units of Three-Wheelers were exported in Q2 of FY-2026-27, which is the highest exports of Q2, with a growth of 30.4%, as compared to same period last year.
d) Commercial Vehicles
· Commercial Vehicle sales stood at 3.09 lakh units in Q2 of 2026–27, reflecting a growth of 28.7% compared to Q2 of 2025–26.
· Infrastructure spending, strong freight movement, replacement demand of older trucks and buses and logistics fleet expansion are providing the impetus to modernize the vehicle parc.
· More than 0.41 lakh units of Commercial Vehicles were exported with a growth of 72.5% in Q2 of 2026-27, as compared to Q2 of last year.
Growth Outlook for H2 (October 2026 – March 2027)
· The automobile industry is expected to maintain positive growth momentum in H2 of FY2026–27, although reported growth rates may moderate as the sector begins to grow against a higher base. Demand fundamentals remain supportive, aided by the festive season, new product launches, last-mile mobility requirements, infrastructure spending and fleet replacement.
o Passenger Vehicles growth will remain positive, with new launches expected to sustain consumer interest and demand.
o For Two-Wheelers, the festive season is expected to support near-term momentum. While growth rates may moderate against the higher post-GST base of the previous year, underlying demand fundamentals are expected to remain supportive and sustain healthy growth.
o Three-Wheelers demand is expected to remain strong, supported by growth in cargo applications across fuel types, robust last-mile mobility demand and the segment’s favourable total cost of ownership. However, inflationary pressures and any increase in interest rates could moderate demand.
o Commercial Vehicles segment is expected to benefit from infrastructure spending, fleet replacement and demand generated by the PARIVARTAN scheme.
· While the automobile industry remains watchful of higher inflationary trend which can lead to higher interest rates and geopolitical developments, the overall outlook for rest of 2026-27 remains encouraging, with the automobile sector expected to close the fiscal year on positive growth trajectory.
Monthly Performance: September 2026
Production: The total production of Passenger Vehicles1, Three Wheelers, Two Wheelers, and Quadricycle in September 2026 was 34,52,554 units
Domestic Sales:
· Passenger Vehicles2 sales were 4,54,574 units in September 2026.
· Three-wheeler sales were 98,162 units in September 2026
· Two-wheeler sales were 24,63,103 units in September 2026.
1 BMW, Mercedes, JLR, Tata Motors & Volvo Auto data are not available.
2 BMW, Mercedes, JLR & Volvo Auto data are not available. Tata Motors Domestic Sales data for September included only in this document. However, without Tata Motors, ‘Total PV’ would be 3,85,764 units for September 2026
Performance: July-September 2026
Production: The total production of Passenger Vehicles3, Commercial Vehicles4, Three Wheelers, Two Wheelers, and Quadricycle in July-September 2026 was 1,05,57,400 units
Domestic Sales:
· Passenger Vehicles3 sales were 13,60,687 units in July-September 2026.
· Commercial Vehicles4 sales were 3,09,063 units in July-September 2026.
· Three-wheeler sales were 2,85,342 units in July-September 2026.
· Two-wheeler sales were 64,32,842 units in July-September 2026.
Performance: April-September 2026
Production: The total production of Passenger Vehicles3, Commercial Vehicles4, Three Wheelers, Two Wheelers, and Quadricycle in April-September 2026 was 1,99,46,193 units
Domestic Sales:
· Passenger Vehicles3 sales were 26,37,067 units in April-September 2026.
· Commercial Vehicles4 sales were 5,74,255 units in April-September 2026.
· Three-wheeler sales were 5,01,879 units in April-September 2026.
· Two-wheeler sales were 1,20,86,812 units in April-September 2026.
3BMW, Mercedes, JLR & Volvo Auto data are not available.
4Daimler data is not available.
Commenting on the Q2 2026-27 performance, Mr Shenu Agarwal, President, SIAM said,
“The Indian automotive industry delivered a strong performance in the first half of FY2026-27, following a robust second quarter and a strong September 2026. This stellar performance across all segments of the automobile industry has been supported by improved affordability following GST 2.0, resilient rural and urban demand, healthy freight movement, infrastructure-led economic activity, and a gradual replacement cycle across vehicle segments. The electric vehicle ecosystem also continues to mature with multiple offerings, improving charging infrastructure and supportive policy measures. At the same time, alternative fuel technologies are witnessing increasing acceptance and are expected to play an important role in India's sustainable mobility transition.
Industry looks forward to the festive season for the continued momentum while remaining cautiously optimistic due to prevailing geo-economic uncertainties. Continued investments in infrastructure, sustained economic growth, and rising adoption of cleaner and more efficient mobility solutions are expected to support industry growth through the second half of 2026-27.”
Commenting on the performance of Q2 of 2026-27, Mr Rajesh Menon, Director General, SIAM said, “Sales of Passenger Vehicles in Q2 of 2026-27 grew by 30.7%, posting sales of 1.36 million units as compared to Q2 of previous year. Sales of Three-Wheelers in Q2 of 2026-27 grew by 23.6% compared to last year, with 2.85 Lakh units. Two-Wheelers registered a growth of 15.2% in this Quarter, compared to last year, with sales of 6.43 million units while Commercial Vehicles grew by 28.7% in Q2, compared to Q2 of last financial year, with sales of 3.09 Lakh units. Q2 of FY 2026–27 recorded the highest ever Q2 sales of all the segments, including Passenger Vehicle, Commercial Vehicle, Three-Wheeler and Two-Wheeler”.
Rajesh Menon, Director General, SIAM
rajesh.menon@siam.in