Auto retail sales rise 7.7% as GST revival

India’s automobile retail industry ended 2025 on a firm footing, recording healthy growth across most segments despite a subdued start to the year.

- TBG NETWORK

According to data released by the Federation of Automobile Dealers Associations (FADA), total vehicle retail sales in 2025 stood at 28.16 million units, marking a 7.71 per cent year-on-year increase.

The performance reflected a clear turnaround in the latter half of the year, supported by policy measures, improving affordability and strengthening consumer sentiment.

FADA described 2025 as a “two half year.”

While the January-August period remained muted due to cautious consumer spending and selective financing approvals, the scenario changed sharply from September onwards.

The implementation of GST 2.0 rate rationalisation, which reduced tax incidence on mass-market vehicles such as small cars, two-wheelers, three-wheelers and select commercial vehicles, played a pivotal role in reviving demand.

This, according to FADA, led to a sustained upshift in retail activity through the September-December period.

Category-wise performance remained broad-based.