June auto retail sales rise 5% YoY backed by all segments

Automobile retail sales in June 2025 grew 4.84% year on year (YoY) backed by growth in all segments of the industry.

Two-wheelers (2W) rose at 4.73%, three-wheelers (3W) grew 6.68%, passenger vehicles (PV) inched 2.45%, tractor sales surged 8.68%, and commercial vehicles (CV) rose by 6.6%, according to data released by the Federation of Automobile Dealers Associations (FADA) on Monday.

In case of 2Ws, while festival and marriage-season demand provided a boost, financing constraints and intermittent variant shortages moderated sales, said FADA president C.S. Vigneshwar.

“Early monsoon rains and rising electric vehicle (EV) penetration also shaped buying patterns. Several dealers cited compulsory billing and forced stock lifts — often via auto-debit wholesales — leading to mandated high days of inventory aligned with festival-season targets. Overall, June demonstrated a resilient two-wheeler performance amid mixed market signals,” he said.

PV retails slipped 1.49% MoM and heavy rains and tight market liquidity weighed on footfall and conversion, even as elevated incentive schemes and fresh bookings lent selective support.

“Some dealers indicated that certain PV OEMs have introduced compulsory billing procedures such as automatic wholesale debits to meet volume targets; inventory consequently stands at around 55 days. June thus painted a picture of modest but steadfast PV performance amid varied market cues,” the FADA president said.

In CVs, early-month deliveries buoyed volumes before monsoon-induced slowdowns and constrained liquidity dampened enquiries and conversions. “Members pointed to the impact of new CV taxation and mandatory air-conditioned cabins, which have elevated ownership costs, alongside muted infrastructure demand. Overall, June reflected a resilient CV segment adeptly navigating cost pressures and a softening economy,” Mr. Vigneshwar said.

According to FADA projections, above-normal monsoon rains should bolster rural demand even as heavy-to-very-heavy precipitation could lead to logistical complexities.