FADA Releases January’26 Vehicle Retail Data

Auto-Retail January 2026: Broad-Based Momentum Anchored in Rural Demand & Policy Support

January’26 Retail Performance

• Overall Retail: 27,22,558 units | +17.61% YoY
• 2W: 18,52,870 units | +20.82% YoY
• PV: 5,13,475 units | +7.22% YoY
• CV: 1,07,486 units | +15.07% YoY
• 3W: 1,27,134 units | +18.80% YoY
• Tractors: 1,14,759 units | +22.89% YoY
• CE: 6,834 units | -21.09% YoY

Context & Demand Drivers

• Powered by post-GST momentum, healthy rural cash flows from harvest and weddings, and sustained demand across mobility and freight
• Dealer feedback highlights strong enquiry momentum, sharper customer engagement, quicker digital follow-ups, and shift towards higher-value models
• Rural volumes robust, supported by Pongal/Makar Sankranti and marriage-season footfalls
• Challenges include selective supply constraints, aggressive competitive discounting, and high-base effects in some segments

Segment Highlights

• 2W: Led overall charge; rural share ~56% (urban ~44%); Rural +19.77% YoY vs Urban +22.19% YoY — signaling urban revival and demand normalization beyond festive buying; aided by better affordability
• PV: Urban-led mix (~59.2% urban, ~40.8% rural); growth story in non-metro India with Rural +14.43% YoY significantly ahead of Urban +2.75% YoY; driven by SUV/compact-SUV preference, entry-level revival, product availability, and schemes; inventory softened to ~32–34 days
• CV: Improving freight sentiment and replacement buying; LCV 65,505 units (+14.94% YoY), HCV 34,287 units (+14.61% YoY); balanced geographies with Rural +16.25% YoY edging Urban +13.94% YoY; supported by goods movement, infrastructure, and single-owner confidence,

Near-Term Outlook

• Sustained demand visibility across segments, with cautious optimism amid segment-specific recalibration (e.g., CE under pressure from high-base impact)
• Focus on addressing supply constraints and competitive pressures to maintain retail playbook
• Overall sentiment remains Positive.

Next 3 Months Outlook

• Expect continued broad-based growth, reinforced by structural expansion of demand beyond metros
• Key enablers: ongoing affordability gains, rural cash flows, and product momentum
• Overall sentiment remains Optimistic.

10^th February’26, Mumbai, BHARAT: The Federation of Automobile Dealers Associations (FADA) today released Vehicle Retail Data for January’26.

Jan’26 Auto Retail

Reflecting on January 2026 Auto Retail performance, FADA President Mr. C S Vigneshwar said: “January’26 has delivered a strong, broad-based start to the calendar year, with overall vehicle retail at 27,22,558 units, registering +17.61% YoY. The growth was powered by continued post-GST momentum, healthy rural cashflows on the back of harvest and weddings, and sustained demand visibility across mobility and freight. Category-wise, 2W grew +20.82% YoY, PV +7.22% YoY, CV +15.07% YoY and Tractors +22.89% YoY; 3W remained resilient at +18.80% YoY. On the other hand, Construction Equipment continues to remain under pressure at -21.09% YoY, indicating a high-base impact and segment-specific recalibration.

Two-Wheelers led the charge with 18,52,870 units (+20.82% YoY). Importantly, the demand engine remains anchored in Bharat, with the rural share at ~56% (urban ~44%). While rural volumes stayed robust (Rural: +19.77% YoY) supported by Pongal/Makar Sankranti, marriage-season footfalls and better affordability, we are also seeing a clear revival in urban markets (Urban: +22.19% YoY)—a healthy signal of demand normalisation beyond festive-only buying. Dealer feedback points to strong enquiry momentum driven by sharper customer engagement, quicker digital follow-ups, and a visible shift towards higher-value and mid-powered motorcycles. That said, selective model-wise supply constraints and aggressive competitive discounting continue to shape the near-term retail playbook in a few pockets.

Commercial Vehicles clocked 1,07,486 units (+15.07% YoY), reflecting improving freight sentiment and replacement-led buying. The uptrend is visible across tonnage bands, with LCV at 65,505 units (+14.94% YoY) and HCV at 34,287 units (+14.61% YoY), aligning with dealer feedback around stronger goods movement, infrastructure activity and renewed confidence among single-owner operators. From a market mix standpoint, both geographies participated—Urban: +13.94% YoY and Rural: +16.25% YoY—highlighting that logistics-led demand is not limited to metros alone.

Passenger Vehicles recorded 5,13,475 units (+7.22% YoY). The mix remains urban-led at ~59.2%, with rural at ~40.8%; however, the growth story is increasingly being written in non-metro India—Rural PV grew +14.43% YoY, significantly ahead of Urban at +2.75% YoY. This reinforces the structural expansion of PV demand beyond the top cities, aided by a strong SUV/compact-SUV preference, revival of entry level cars, product availability and continued schemes. Crucially, PV inventory levels continued to soften to ~32–34 days, which is a constructive indicator of healthier channel discipline and improved working-capital efficiency across the network.”

Near-Term Outlook (Feb’26)

February’26 sentiment is firmly constructive, backed by supportive macros and on-ground dealer confidence as 72.56% of dealers expect growth and only 4.51% expect de-growth. The operating environment is being strengthened by a growth-oriented Budget with a clear infra–agri thrust, continued wedding/festival tailwinds, and RBI rate stability on top of 2025’s easing—together improving affordability, financing comfort and purchase intent. Dealers are also flagging healthier enquiry inflows versus January and stronger pipeline management as a conversion lever, with the key watch-outs being the shorter month, high base from recent strong runs, and localised factors like election-related interruptions and selective supply constraints in certain models/variants.

Category-wise, 2W is expected to stay positive on improved enquiries, wedding-led mobility purchases, rural liquidity from crops, and growing acceptance of EV models—however, upside will be capped where stock/variant availability remains tight, net-net, outlook is growth to stable, with rural momentum still a key pillar. PV should see steady traction driven by a strong booking pipeline, new launch/variant excitement and continued GST-led affordability, with incremental support from rural demand during the marriage season; nonetheless, a high base, allocation/production constraints could make growth more measured, alongside ongoing focus on VIN-wise inventory clean-up. CV sentiment remains favourable into Q4 on the back of infra activity, freight and event-driven goods movement, and year-end purchase decisions (including depreciation-led buying), though discount intensity and some purchase preponement will need monitoring; overall bias is positive, led by LCV and select MHCV applications. Overall near term outlook hence remains positive.

Next 3 Months Outlook (FMA’26)

Over the next three months, dealer confidence remains decisively constructive, with 79.70% of respondents expecting growth and only 1.88% indicating de-growth. The near-term macro setup is supportive: a growth-oriented Budget with a visible infra and agri thrust, policy continuity post GST 2.0, and rate stability after 2025’s easing are collectively improving affordability, financing comfort and purchase intent. On-ground feedback also points to stronger enquiry pipelines, tighter follow-ups, and local marketing/activation intensity translating into higher conversion potential—while the key watch-outs remain election-related disruptions in select states, the usual seasonality/short-month effects, and model/variant availability in specific pockets.

Category-wise, 2W is expected to stay on a positive slope, led by conversion of pending enquiries, continued wedding/festival tailwinds (Shivratri, Navratri/Gudi Padwa/Ugadi), improving rural liquidity from crops, and rising traction in scooters, commuter motorcycles and EV acceptance—though growth will be capped where OEM supply/variant constraints persist and where election codes impact footfalls. CV outlook remains favourable through the quarter as dealers report an upcycle supported by infra project gearing, improving freight environment, and Q4 replacement/addition decisions, with applications linked to construction/logistics and goods movement expected to perform better than discretionary categories. PV should see a strong Feb–Mar run on the back of booking pipeline strength, new model/variant excitement, and financial year-end buying (including depreciation-led decisions for some customer cohorts), but April could normalise as festive intensity fades and base effects may play out unevenly across brands and regions. Overall next 3 months outlook hence remains Optimistic.

Key Findings from our Online Members Survey

• Liquidity

• • Good                  60.53%
  • Neutral              31.20%
  • Bad                     08.27%

• Sentiment
  • Good                  64.29%
  • Neutral              28.20%
  • Bad                     07.52%

• Expectation from February’26

• • Growth               72.56%
  • Flat                      22.93%
  • De-growth         04.51%

• Expectation in next 3 months

• • Growth               79.70%
  • Flat                      18.42%
  • De-growth         01.88%