New Delhi, 8th September 2025: The Federation of Automobile Dealers Associations (FADA) released vehicle retail data for August 2025, showing steady growth amid high festive enquiries, though the landmark GST 2.0 reformsprompted many buyers to defer purchases to September.

India’s overall auto-retail industry registered a 2.84% year-on-year (YoY) growth in August, while staying flat on a month-on-month (MoM) basis at +0.02%. Strong festive enquiries during Onam and Ganesh Chaturthi kept customer sentiment high, but excessive rains and the upcoming GST regime slowed conversions.

Segment-Wise Performance

• Two-Wheelers (2W): Retail sales grew +2.18% YoY and +1.34% MoM. Enquiries remained robust, though erratic supplies of scooters and GST deferments moderated final sales.
• Passenger Vehicles (PV): Sales rose modestly by +0.93% YoY, but dipped -1.63% MoM. Despite healthy bookings, heavy rains and anticipation of GST 2.0 lowered conversion rates. Inventory stood elevated at ~56 days.
• Commercial Vehicles (CV): Posted a strong +8.55% YoY growth, backed by e-commerce demand and fleet replacement, but softened -1.11% MoM due to GST-driven deferments.
• Tractors (Trac): Surged +30.14% YoY, fueled by strong monsoons, rural liquidity, and a positive crop outlook.
• Three-Wheelers (3W): Declined -2.26% YoY and -7.47% MoM, as electric rickshaw sales dipped.
• Construction Equipment (CE): Slumped -26.45% YoY and -5.56% MoM, dragged down by weak infra demand and seasonal impact.

GST 2.0: Game-Changer for Auto Industry

FADA President Mr. C. S. Vigneshwar hailed GST 2.0 as a “historic, people-first reset”, introducing simplified slabs of 5%, 18%, and 40%. The new regime, effective 22nd September 2025, is expected to lower household expenses, improve affordability, and boost auto demand.

He added:

“The GST 2.0 announcement has not dampened demand but only deferred it. Families are aligning vehicle purchases with the revised tax slabs. September will mark the start of a strong growth cycle, driven by both festive demand and policy reforms.”

Near-Term Outlook: September to See Strong Rebound

India enters September with stable macroeconomic fundamentals — GDP growth between 6.3–6.8%, CPI at a multi-year low of 1.55%, and a monsoon 8% above normal. These factors, combined with festive demand (Navratri, Durga Puja) and OEM schemes offering GST-aligned benefits, are expected to unlock deferred demand.

FADA expects September to play out in two phases:

• Early September: Muted demand due to Shraddh rituals and GST deferments.
• Late September: Strong rebound as festive bookings, GST clarity, and OEM discounts converge.

Dealer Sentiment & Market Confidence

According to FADA’s dealer survey:

• 62.75% expect growth in September,
• 77.9% foresee expansion over the next three months.

This reflects a decisively optimistic outlook, with auto-retail poised for accelerated growth in the festive quarter.