New Delhi [India], October 30 : The festive season in the October has brought mixed trends for India's automobile industry, with passenger vehicles (PVs) and tractors showing signs of improvement while two-wheelers (2Ws) continue to trail expectations, according to a report by Nomura.
The report estimates for October show that PV volumes are likely to rise by 3 per cent year-on-year, while medium and heavy commercial vehicles (MHCVs) remain stable with a 2 per cent growth. In contrast, tractors and two-wheelers are expected to decline by 6 per cent year-on-year each.
It stated "Festive improvement for tractors and PVs 2Ws trail below expectations, MHCVs stable"
The report highlighted that following the Goods and Services Tax (GST) cuts, demand has improved across tractors, PVs, and two-wheelers, while it has remained stable for MHCVs.
Tractor demand during the festive season has been stronger than expected, though two-wheeler growth in the mid-to-high single digits.
PV demand, on the other hand, is projected to grow in the teens, supported by festive momentum and GST benefits.
The report noted that due to pent-up demand in September, the most effective way to gauge overall market trends is by assessing cumulative retail data from August to November.
So far, cumulative festive data from Ganesh Chaturthi (August 27) to date indicate a 5-6 per cent volume growth for both PVs and two-wheelers.
The report estimated PV wholesales at around 3 per cent year-on-year for October 2025, while PV retail volumes have shown a stronger 14 per cent year-on-year growth.
However, wholesale dispatches are likely to be constrained by limited truck availability and fewer production days due to festive holidays. As a result, OEMs with higher dealer inventory could gain retail market share during this period.
Looking ahead, the report expects mid-teens growth for the second half of FY26, supported by the sharp GST cuts. However, festive season growth in mid-to-high single digits remains below initial expectations.
The brokerage also cautioned that the upcoming mandatory Anti-lock Braking System (ABS) implementation deadline from January 2026 remains a key risk for the sector.
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