India’s automobile market began 2026 on a high, with passenger vehicles, two-wheelers and three-wheelers recording their highest-ever wholesale January sales, signalling a broad-based demand recovery backed by policy support and improving consumer sentiment.
According to data released by the Society of Indian Automobile Manufacturers (SIAM), total vehicle sales across key segments grew at double-digit rates compared to January 2025, underlining strong momentum entering the final quarter of FY26.
Passenger vehicle (PV) sales rose 12.6% year-on-year to 4.50 lakh units in January 2026, up from 3.99 lakh units a year earlier. The performance reflects continued traction in the SUV and premium segments, alongside improving availability and stable financing conditions.
With inventory levels largely under control and order books steady, automakers are seeing healthier retail throughput, suggesting that demand is no longer limited to festive or seasonal spikes.
Two-wheelers delivered the strongest volume impact, with sales jumping 26.2% to 19.26 lakh units, compared with 15.26 lakh units in January 2025. The sharp rise points to reviving rural demand, supported by easing inflation, improved cash flows, and price stability following tax relief measures.
For manufacturers, this rebound is critical: two-wheelers remain the industry’s largest segment by volume and a key indicator of mass-market consumption.
Three-wheelers posted the fastest growth rate among all segments, expanding 30.2% year-on-year to 0.76 lakh units, up from 0.58 lakh units last January. The surge reflects rising demand for last-mile connectivity, intra-city logistics, and shared mobility, particularly as economic activity normalises across urban and semi-urban markets.
Industry executives attribute the strong start to the year to a combination of policy continuity and fiscal support.
Rajesh Menon, Director General of SIAM, said the momentum seen in the previous quarter has carried into the new year, aided by sustained demand following the GST rate reduction.
He added that initiatives announced in the Union Budget 2026, aimed at strengthening India’s manufacturing base, are expected to provide structural support to the auto sector, reinforcing medium-term growth visibility.
January’s record-breaking performance suggests that India’s auto recovery is no longer narrowly concentrated, but increasingly broad-based across segments and geographies. While cost pressures and global uncertainties remain, the combination of rising volumes, policy tailwinds, and improving demand fundamentals positions the industry for a stable growth trajectory through the remainder of FY26.