New Delhi [India], October 7 : India's automobile retail sector witnessed a remarkable turnaround in September 2025, driven by the twin impact of festive demand and the rollout of the landmark GST 2.0 reforms, the Federation of Automobile Dealers Associations (FADA) said on Tuesday.
According to FADA Vice President Sai Giridhar, the first three weeks of September were subdued as customers deferred purchases in anticipation of the new GST regime. However, sentiment reversed dramatically in the final week when Navratri festivities coincided with the implementation of lower GST rates, igniting a strong consumer response across segments.
"September 2025 was an exceptionally unique month for India's automobile retail industry. The first three weeks were largely muted, but the dynamics changed in the final week as festive cheer and GST 2.0 reforms revived sentiment. As a result, the month ended with an overall 5.22% YoY growth," Giridhar said.
Two-wheelers led the rebound with 6.5 per cent growth, followed by passenger vehicles at 5.8 per cent, tractors at 3.6 per cent, and commercial vehicles at 2.6 per cent. However, three-wheelers and construction equipment witnessed declines of 7.2 per cent and 19 per cent, respectively.
FADA noted that while the surge came late in the month, dealers used the window to replenish inventory, especially in the PV segment, where stock levels have now risen to around 60 days, indicating preparedness for the peak festive season in October.
Describing Navratri 2025 as a "Never Seen Before" moment, Giridhar said the festival turned into a true 'Bachat Utsav', unlocking record-breaking sales.
"Navratri 2025 will go down as one of the most memorable chapters in India's automobile retail journey a true celebration of affordability and optimism unleashed by GST 2.0. Overall retails surged by 34% YoY, marking a historic high during any festive season," he added.
Two-wheelers reported 36 per cent growth, passenger vehicles 34.8 per cent, commercial vehicles 14.8 per cent, three-wheelers 24.5 per cent, and tractors 18.7 per cent, while construction equipment declined by 18 per cent due to heavy rainfall slowing construction activities.
Giridhar credited the GST 2.0 reform for rejuvenating buyer sentiment and sparking record footfalls and deliveries nationwide. "It reminded us what the right policy at the right time can do for a nation's sentiment," he said.
Looking ahead, FADA expressed high optimism for October 2025, with Dhanteras and Deepawali expected to deliver all-time high sales.
"With GST 2.0 enhancing affordability, above-normal monsoon boosting rural income, and stable interest rates supporting financing, India stands at the cusp of its most spectacular 42-day festive season in history," FADA said.
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