FADA Releases Aug’25 Vehicle Retail Data

Auto-Retail August 2025: Festive Enquiries Strong, GST 2.0 Defers Purchases to September

Retail Performance

Overall Retail: +2.84% YoY | +0.02% MoM

• 2W: +2.18% YoY | +1.34% MoM
• 3W: –2.26% YoY | -7.47% MoM
• PV: +0.93% YoY | -1.63% MoM | Inventory ~56 days
• Trac: +30.14% YoY | –3.95% MoM
• CE: –26.45% YoY | –5.56% MoM
• CV: +8.55% YoY | –1.11% MoM

Segment Highlights

• 2W: Festive enquiries high (Onam, Ganesh Chaturthi); rains & GST deferments slowed conversions.
• PV: Healthy bookings but GST 2.0 wait-and-watch and heavy rains supply kept growth muted.
• CV: Solid YoY growth on ecommerce & replacement demand; GST sentiment slowed last week.
• Trac: Exceptional growth, driven by strong monsoon, rural liquidity, and crop outlook.

Policy Spotlight – GST 2.0

“GST 2.0 marks a historic, people-first reset — courage, consensus, and clarity in taxation.” — FADA President, Mr. C. S. Vigneshwar

• Implementation from 22nd September
• Simplified slabs: 5%, 18%, 40%
• Benefits: Lower household costs, stronger demand, industry competitiveness

Near-Term Outlook (September 2025)

• Macros: GDP 6.3–6.8% growth, CPI 1.55% (multi-year low), monsoon +8% above normal.
• Auto Retails: Two-phase month
  • Early September: muted (Shraddh + GST deferments)
  • Late September: strong rebound (Navratri, GST clarity, festive demand)
• OEM Schemes: Offering price benefits now, so customers can book early and ensure deliveries on auspicious days.

FADA View: Decisively Optimistic — September to mark the start of a strong growth cycle for Indian Auto Retail.

8^th September’25, Mumbai, BHARAT: The Federation of Automobile Dealers Associations (FADA) today released Vehicle Retail Data for Aug’25.

GST 2.0 reforms

Reflecting on GST 2.0 reforms FADA President Mr. C S Vigneshwar said: “Under the visionary leadership of Hon’ble Prime Minister Shri Narendra Modi ji, GST 2.0 marks a historic, people-first reset — moving India towards a citizen-friendly ‘Simple Tax’ with just two slabs, along with a special rate for a select few. It embodies courage, consensus, and clarity in indirect taxation.

The landmark announcement from the Red Fort has only strengthened buyer optimism, with many families preferring to align their purchases with the forthcoming reduced GST rates. This is a reflection of trust in policy, which has not dampened demand but merely deferred a part of it to September, when we expect festive deliveries and conversions to gather full momentum.

The resilience of India’s auto retail industry, combined with the once-in-a-generation reform of GST 2.0, positions the sector for a robust festive season. Dealers remain confident that September will herald the beginning of an accelerated growth cycle, powered by both policy tailwinds and festive fervour.”

August’25 Retails

Reflecting on August 2025 Auto Retail results, FADA President Mr. C S Vigneshwar said: “August traditionally ushers in festive cheer, with Onam and Ganesh Chaturthi heralding the season of joy. Customers continued to show strong enthusiasm with high enquiries and robust bookings, ensuring that vehicles are aligned for auspicious festive deliveries. The only issue was conversion, which saw slowdown due to benefits of GST 2.0 kicking in September.

The month concluded with a modest 2.84% YoY growth, led by healthy performances in 2-wheelers (2.18%), passenger vehicles (0.93%), and commercial vehicles (8.55%), while tractors registered an exceptional 30.14% YoY growth. Only 3-wheelers (-2.26%) and construction equipment (-26.45%) moderated slightly.

The 2W retails in August registered a modest growth of 1.34% MoM and 2.18% YoY. Enquiries remained strong, fuelled by the onset of festivals such as Onam and Ganesh Chaturthi, with many customers keen on auspicious-day deliveries. However, excessive rains and localised floods in North India disrupted rural mobility, while erratic supply of popular scooter models constrained conversions. The landmark GST 2.0 announcement also led to buyers deferring purchases to September in anticipation of lower rates. Despite these factors, overall sentiment is steady, and dealers remain confident that the festive season ahead will unlock robust growth momentum.

CV retails in August grew by 8.55% YoY but softened marginally by -1.11% MoM. Dealer feedback suggests that while product acceptance and order clearances remained healthy — supported by new contracts from ecommerce and replacement demand — market sentiment in the last week was impacted by speculation around GST reductions, leading to deferment of purchases. With rains subsiding and festive demand ahead, dealers remain confident of stronger traction in September.

PV retails in August recorded a modest growth of 0.93% YoY while softening by -1.63% MoM. The month began on a positive note with healthy enquiries and festive bookings, but momentum slowed in the latter half as the announcement of GST 2.0 reforms led many customers to postpone purchases, anticipating a price reduction. Heavy rains and floods in some regions further disrupted walk-ins, while uneven supply of high-demand models and aggressive OEM targets added to the pressure. At the close of August, average inventory levels stood elevated at around 56 days. Despite this temporary  pause, demand fundamentals remain intact, supported by festive sentiment and strong customer interest in both ICE and EV models. Dealers expect September to deliver a sharper rebound, as GST clarity and auspicious festive days converge to unlock deferred demand.”

Near-Term Outlook

India enters September 2025 on a foundation of strong growth, backed by low inflation and macroeconomic stability. GDP growth is tracking 6.3–6.8% for the year, while CPI inflation touched a multi-year low of 1.55% in July, reflecting easing food and fuel prices.

The rollout of GST 2.0 from 22nd September is set to be a game-changer — lowering household expenses, lifting consumption, and improving industry competitiveness. Economists expect it could reduce inflation by up to 1.1 percentage points. A vigorous monsoon has further strengthened rural liquidity, with agriculture poised for above-trend output despite some localized flood damage.

For auto retails, September will be a two-phase month: a muted first half due to Shraddh and GST wait-and-watch, followed by a sharp surge as policy clarity, festive sentiment, and OEM schemes that mirror upcoming GST reductions converge. These schemes allow customers to book vehicles now while enjoying GST-aligned benefits, ensuring timely deliveries on their preferred auspicious dates such as Navratri and Durga Puja. Dealers across categories expect this strategy to unlock deferred demand and smoothen festive season supply.

With GST 2.0 as a landmark reform, proactive OEM schemes, and the onset of India’s biggest festivals, FADA remains decisively optimistic that September will mark the beginning of a strong growth cycle for auto retail.

Key Findings from our Online Members Survey

• Liquidity

• • Neutral              41.30%
  • Good                  32.97%
  • Bad                     25.72%

• Sentiment
  • Neutral              42.39%
  • Good                  38.41%
  • Bad                     19.20%

• Expectation from September’25

• • Growth               62.75%
  • Flat                      22.83%
  • De-growth         09.42%

• Expectation in next 3 months

• • Growth               77.90%
  • Flat                      18.48%
  • De-growth         03.62%