India's auto industry to maintain strong momentum in FY27: Report
New Delhi, July 2
Cumulative domestic two‑wheeler sales grew 22 per cent year‑on‑year to 33.6 lakh units in April-June 2026, while passenger vehicle domestic sales rose about 25 per cent to 12.7 lakh units, a report said on Thursday, adding that the industry will maintain momentum in FY27.
"Looking ahead to FY27, we remain cautiously positive about domestic PV sales and expect industry volumes to grow at a mid-single-digit pace," the report from Axis Securities said.
The growth will be supported by improving consumer affordability, rising EV adoption and new model launches, partly offset by price hikes undertaken by OEMs to mitigate the impact of volatile raw material prices amid macroeconomic uncertainties.
Two‑wheeler exports showed improved traction across global markets and domestic commercial vehicle volumes increased 18 per cent year‑to‑date to 2.52 lakh units
The rise in domestic commercial vehicle volumes reflected strong performance supported by an early replacement cycle and positive freight demand.
Three‑wheeler domestic wholesales rose to 1.55 lakh units year‑to‑date and tractor sales climbed 19 per cent.
Potential upside triggers for domestic demand of two wheelers and three wheelers include government-led consumption measures, an uptick in rural demand, and new model launches.
"The overall industry outlook for FY27 remains positive, driven by strong demand prospects, rising EV adoption, and stable income tax levels," the firm said.
However, these positives are likely to be partially offset by unfavourable macroeconomic conditions and the high base of the preceding financial year, it added.
In June 2026, domestic two‑wheeler OEM sales rose roughly 13 per cent YoY but fell 3 per cent month‑on‑month, while three‑wheelers posted 63 per cent YoY growth and 10 per cent month‑on‑month gains.
Commercial vehicle dispatches are likely to see positive momentum in FY27, supported by the improving fleet utilisation and early replacement demand. However, the pace of growth may be partly offset by geopolitical tensions and potential disruptions in raw material supply chains, which could impact exports and lead to production slowdowns in the near term.
— IANS
Reader Comments
Finally some good news! 🌟 The 22% growth in two-wheelers is a lifeline for many middle-class families like ours. My husband just bought a new scooter last month – it’s cheaper than a car and perfect for our city commutes. Hope the government keeps taxes low to sustain this momentum.
Cautiously optimistic but wary of the fine print. "Mid-single-digit growth" isn’t exactly exciting, and the report itself admits that price hikes and raw material volatility could bite. Plus, with geopolitical tensions in West Asia, our supply chains are fragile. Let’s hope the EV push isn’t just talk – we need more charging infrastructure than flashy launches.
The tractor sales growth of 19% speaks volumes about rural demand picking up! 🚜 My family is a farming household in Punjab, and we’re seeing better crop prices this year. But the report mentions macroeconomic uncertainties – that’s worrying. The government should focus on rural infrastructure to sustain this.
Interesting data, but a bit too rosy for my liking. The 63% YoY growth in three-wheelers is staggering – are we sure it’s genuine demand and not just inventory build-up? Also, the report glosses over the fact that many OEMs are still struggling with margins due to input costs. Let’s see if FY27 really delivers.
Encouraging numbers for sure, but I’m concerned about the environmental angle. Rising vehicle sales = more pollution, unless EV adoption really takes off. The report says "rising EV adoption" but
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