Auto sector to report strong growth with PV and CV volumes expanding over 20% YoY in July: Nuvama Report
New Delhi, July 29
Domestic automobile wholesales are expected to sustain their upward trajectory in July 2026, with passenger vehicle and commercial vehicle volumes likely to expand by over 20 per cent year-on-year, according to a report by Nuvama.
The PV segment is anticipated to register robust double-digit growth, expanding by over 25 per cent YoY in the domestic market during July 2026.
Simultaneously, CV industry volumes are projected to post double-digit expansion exceeding 20 per cent YoY in the domestic market for the month.
Industry demand continues to receive support from improved affordability, new product introductions, and adequate financing availability across retail channels.
Detailing the near-term momentum across primary categories, the Nuvama report stated, "2Ws and tractors are anticipated to report growth of over 10%. Meanwhile, exports growth is likely to remain positive for most OEMs, supported by growth across Africa, Latin America and Asia regions."
In the two-wheeler (2W) sector, volumes are also set to expand in double digits, recording over 15 per cent YoY growth domestically in July 2026. This trajectory is underpinned by "enhanced affordability, marriage season demand, and adequate financing availability."
Furthermore, positive export growth for mass-market original equipment manufacturers is expected to continue, driven by expanding sales across Africa, Latin America, and Asia.
The tractor segment is projected to continue its upward trajectory in July 2026, with domestic volume growth exceeding 10 per cent YoY. This momentum stems from "improved affordability, enhanced rural liquidity, and credit availability." However, terms of trade within the sector remain adverse, largely on account of fuel inflation.
Addressing the key variable for rural demand going forward, the report noted, "Going forward, rainfall coverage and spread would be a key monitorables for farmer sentiments and tractor demand."
Looking at the medium-term outlook spanning FY26 to FY28, the report highlights stronger growth prospects for personal transport segments compared to commercial and agricultural machinery. Domestic PVs and 2Ws are expected to achieve compound annual growth rates (CAGR) of 11 per cent and 7 per cent, respectively.
Conversely, growth is projected to remain moderate for medium and heavy commercial vehicles (MHCVs) as well as tractors.
— ANI
Reader Comments
Good to see the auto sector booming. But we also need to think about pollution levels—everyone buying new cars and two-wheelers without proper emission norms could backfire. Hope the government pushes for more electric vehicles alongside this growth. 🌿
The mention of improved affordability and financing is interesting. But with rising interest rates and inflation, I'm skeptical about how long this demand can sustain. People are taking loans for everything now—hope it doesn't lead to a debt trap like in some other sectors.
As someone who follows Indian markets from abroad, this is impressive growth. The 2W and tractor segments are doing particularly well, which suggests rural demand is finally picking up. Hope the monsoon holds up—that's always the wild card for Indian agriculture. 🌾
The report says PVs and 2Ws will have 11% and 7% CAGR over FY26-28. That's optimistic but not unrealistic if infrastructure keeps improving. However, the moderate growth for trucks and tractors is a concern—might mean rural distress is still there despite this short-term boost.
Interesting data. But India's auto sector growth has always been cyclical—this might be a post-election bounce. Let's see if it continues through Diwali. Also, tractor demand depends heavily on monsoons, so fingers crossed for good rainfall this year. 🤞
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.