Feb’26 Auto Retail
Reflecting on February 2026 Auto Retail performance, FADA President Mr. C S Vigneshwar said: “Feb’26 has turned out to be a landmark month for the Indian auto retail sector, further strengthening the positive momentum seen after the GST 2.0 announcement. Despite being a shorter month, the industry delivered an exceptional performance with total vehicle retails touching 24.09 lakh units, marking a strong 25.62% YoY growth and surpassing the previous best Feb of 2024. The growth was broad-based across almost all segments. On a YoY basis, Two-Wheeler grew by 25.02%, Three-Wheelers by 24.39%, Passenger Vehicles by 26.12%, and Commercial Vehicles by 28.89%, reflecting healthy demand across both personal mobility as well as economic activity-driven segments. Tractors continued their strong run with a sharp 36.35% growth, emerging as the fastest-growing category during the month. With this, five out of six categories—2W, 3W, PV, CV and Tractors—registered their highest-ever February retail volumes, clearly highlighting the strength of underlying demand in the market. The only segment which did not set a fresh February record was Construction Equipment, which saw a marginal decline of 1.22% YoY. Overall, the strong performance during the month indicates that the policy-led confidence in the market, particularly following GST 2.0, is now translating into sustained demand across multiple vehicle segments.
Two-Wheeler retails continued their strong momentum in February’26, reaching 17,00,505 units, up 25.02% YoY. Growth remained broad-based with Urban markets rising 28.96% YoY and Rural markets growing 22.16% YoY, reflecting steady demand across commuter as well as rural segments. Dealers attributed this performance to improved rural liquidity following good crop outcomes, attractive marketing schemes and better affordability post GST revisions, while the marriage season and new product introductions also supported enquiries. However, in some regions supply constraints in select models and board examinations slightly tempered the otherwise strong momentum.
Commercial Vehicle retails in February’26 stood at 1,00,820 units, registering a strong 28.89% YoY growth. Dealers across regions reported improved freight availability, steady e-commerce activity and infrastructure-linked demand supporting fleet additions. The positive sentiment following GST 2.0 also helped improve secondary demand and bulk purchases. However, some pockets saw supply constraints for certain models, though the overall pipeline of bookings and market movement remained encouraging.
Passenger Vehicle retails in February’26 stood at 3,94,768 units, registering a strong 26.12% YoY growth. The momentum remained broad-based with Urban markets growing 21.12% YoY while Rural markets surged 34.21% YoY, indicating a strong continued demand beyond metros. The sharper rural growth is particularly encouraging as it is supporting the sale of small cars, even as SUVs and utility vehicles continue to drive overall volumes. Improved affordability following GST rationalisation, the marriage season and healthy booking pipelines supported by new model introductions also aided demand during the month. Encouragingly, PV inventory levels have further reduced by about five days and now stand at 27–29 days, which is an extremely healthy sign. We appreciate PV OEMs for moving inventory closer to FADA’s recommended 21-day level, reflecting improved supply discipline and stronger alignment between wholesale dispatches and retail demand.”
Near-Term Outlook (Mar’26)
Looking ahead to March’26, dealer sentiment remains largely positive with 75.51% of dealers expecting growth, while 19.90% foresee a stable market and only 4.59% anticipate a decline. Demand is expected to be supported by the confluence of multiple festivals such as Navratri, Ramzan, Ugadi, Gudi Padwa and Eid, along with the financial year-end buying cycle, which traditionally accelerates vehicle purchases across segments. In the two-wheeler segment, strong booking pipelines, improved agri incomes and post-examination demand are expected to support retail momentum. Passenger vehicles may benefit from year-end depreciation advantages, festival-led enquiries and customers advancing purchases ahead of potential price revisions. Meanwhile, commercial vehicles are likely to see continued traction driven by infrastructure activity, freight movement and strong pipeline bookings as businesses close the financial year. However, supply constraints in certain models and evolving global geopolitical developments remain factors to watch. Overall, the outlook for March’26 appears cautiously optimistic, with festive demand and year-end dynamics expected to keep retail momentum intact.
Next 3 Months Outlook (Mar-Apr-May’26)
Looking at the March–May’26 period, dealer confidence continues to remain positive, though it has become a little more measured compared to the previous reading. 67.35% of dealers now expect growth as against the January outlook for Feb–Apr where 79.70% had expected growth. This suggests that while the market is still on a growth path, expectations are gradually normalising after the strong post-GST 2.0 bounce and the exceptionally robust start to the calendar year.
For Two-Wheelers, the near-term support is likely to come from festivals, marriage season, healthy agri-cash flows, improved rural sentiment and carry-forward bookings, though some dealers have flagged elections, supply-side issues and possible fuel price-led uncertainty arising out of global developments. In Passenger Vehicles, March should remain strong on account of year-end buying, Navratri-led demand, low stocks and new product excitement, but April and May are expected to be more normal to soft as seasonal lull, summer months and demand pause after the festive push may come into play. For Commercial Vehicles, sentiment remains relatively steady, backed by economic activity, goods movement, infrastructure-led demand and year-end business closure, although liquidity and supply remain key monitorables.
Overall, the next three months still appear cautiously optimistic—the growth momentum is intact, but compared to the sharper optimism seen earlier, the survey now indicates that the industry may gradually move from a phase of strong rebound to a phase of more stable and calibrated growth.
Key Findings from our Online Members Survey
Liquidity
Good 54.59%
Neutral 34.69%
Bad 10.71%
Sentiment
Good 58.67%
Neutral 31.12%
Bad 10.20%
Expectation from March’26
Growth 75.51%
Flat 19.90%
De-growth 04.59%
Expectation in next 3 months (Mar-Apr-May’26)
Growth 67.35%
Flat 27.55%
De-growth 05.10%
Charts showing Vehicle Retail Data for various period
All India Vehicle Retail Data for FY’26 YTD (Apr’25 to Feb’26)
Source: FADA Research
All India Vehicle Retail Data for Feb’26
Source: FADA Research
Chart showing Fuel Wise Vehicle Retail Market Share for Feb’26
