New Delhi [India], July 4 : The domestic automobile industry is expected to continue witnessing strong export growth across two-wheelers (2W), commercial vehicles (CV), and passenger vehicles (PV), while domestic sales are likely to remain show a mixed bag, according to a report by Axis Securities.
In June 2025, the report stated that the overall domestic two-wheeler (2W) industry recorded a marginal 2 per cent uptick in wholesale volumes.
This was largely driven by a robust 35 per cent year-on-year (YoY) growth in exports. However, domestic 2W volumes declined 3 per cent YoY, indicating a divergence between export and domestic market performance.
It stated, "Continue to See Exports Growth in 2W/CV/PV; Domestic a Mixed Bag Jun'25 Wholesale Volumes: The overall domestic 2W industry witnessed 2 per cent marginal uptick in volumes, led by outperformance in exports."
The passenger vehicle (PV) segment saw domestic sales decline by 7-8 per cent YoY in June 2025. This was due to lower volumes reported by major OEMs such as Hyundai, Tata Motors (TaMo), and Maruti Suzuki.
However, the decline was partly offset by strong performance from Mahindra & Mahindra (M&M), JSW MG, and Toyota. In Q1FY26, domestic PV wholesales were down by 0-1 per cent YoY.
Exports were notably strong, rising 37 per cent, 68 per cent, 13 per cent, and 36 per cent for Maruti, Tata Motors, Hyundai, and M&M, respectively.
The report expects overall PV volumes to grow in low-to-mid single digits in FY26.
In the CV segment, the report proxy for domestic dispatches showed a slight 2 per cent YoY decline on a year-to-date (YTD) basis in Q1FY26.
Among OEMs, VECV, M&M, and Maruti posted domestic volume growth of 9 per cent, 4 per cent, and 7 per cent YoY, respectively. Tata Motors reported a 9 per cent YoY decline, while Ashok Leyland's volumes remained flat.
The report forecasts flat to low single-digit growth for CV players in FY26, led by strong demand in the bus segment.
Two-wheeler exports remained strong in Q1FY26, growing 22 per cent YoY, even as the domestic industry declined by 6 per cent YoY.
The report identified potential upside triggers for domestic 2W demand, including a rural demand pickup, new product launches, government support for consumption (such as tax relief for the middle class), and inventory filling by OEMs.
Overall, the report indicates positive momentum in exports, while domestic demand varies across segments and manufacturers.
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