Auto retail sales up by 2.95% YoY in April; Dealers predict choppy demand in May: FADA
Fada said that disciplined inventory management, targeted incentives, and easing borrowing costs should help the industry navigate the month.
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India's vehicle market witnessed a 2.95% year-on-year rise in sales in April 2025 amid a halt in the tariff war and a bullish stock market, according to the latest data by the Federation of Automobile Dealers Associations of India (FADA).
Notably, the sales of 3-wheelers witnessed a massive jump among all segments of vehicles in April 2025. The three-wheeler sales surged to 99,766 units--an increase of 24.51% YoY. The 2-wheeler sales increased by 2.25% at 16,86,774 units while passenger vehicles saw an increase of 1.55% at 3,49,939 units in the same period.
FADA President CS Vigneshwar noted, "Dealers reported buoyant inquiry growth in rural areas post-Rabi harvest, driven by strong crop yields, healthy reservoir levels, and a favourable monsoon outlook, while wedding-season tailwinds sustained rural offtake. Urban demand remained robust, supported by new-model introductions, although elevated financing costs posed isolated bottleneck".
In contrast, sales of commercial vehicles declined 1.05% at 90,558 units in April this year. Dealers feedback highlighted that advance purchases in March resulted in elevated carryover stocks, while holiday calendars dampened fresh inquiries, the FADA President added.
The association said IMD's above-normal monsoon forecast will fuel rural income, along with Reserve Bank of India's bond purchases will inject surplus liquidity into the banking system, paving the way for enhanced auto-loan affordability. Dealer feedback also painted a nuanced picture for May across all segments. In the 2-wheeler segment, marriage season and post-harvest demand should underpin inquiries.
However, summer heat and school holidays may further suppress showroom visits though IMD predicts that it may not be as bad as last year. PV retails are expected to hold steady but muted, as buyers await new-model roll-outs and contend with elevated financing costs. Commercial vehicles are likely to trade flat, weighed down by a high base effect, slower e-commerce activity, and intensifying competition from electric three-wheelers.
Overall, Fada said demand will be choppy, but disciplined inventory management, targeted incentives, and easing borrowing costs should help the industry navigate the month.
