GST and Festive Demand Drive Double-Digit Growth in Vehicle Sales in October

GST and Festive Demand Drive Double-Digit Growth in Vehicle Sales in October

Issue: To report on the comprehensive recovery and growth across all major vehicle segments in October 2025, driven by the festive buying spree and the consumer stimulus provided by the revised Goods and Services Tax (GST) rates.

Facts:

• The GST rate rationalization took effect in late September, improving the affordability of various vehicle types, components, and spares.
• The consumption surge in October was influenced by Deepavali sales and the general festive season.
• The vehicle sales data reflects solid performance across commercial, passenger, and electric segments.

Decision:

Vehicle sales across most segments recorded double-digit growth in October 2025, with two-wheelers and goods carriers leading the recovery, showcasing a strong correlation between tax rate cuts and increased consumer spending and investment.

Key TakeDowns:

• Two-Wheelers Surge: The two-wheeler segment saw a massive increase of 144% month-on-month (m-o-m) and 52% Year-on-Year (Y-o-Y), reflecting the direct strength of festive purchases and affordability.
• Commercial Vehicle (CV) Recovery: Goods carriers led the recovery, posting a 58% m-o-m and 23% Y-o-Y increase. This was buoyed by rising demand for last-mile delivery, urban logistics, and infrastructure spending.
• Passenger Cars: Passenger car sales rose by 83% m-o-m and 11% Y-o-Y, signaling healthy consumer sentiment.
• Electric Vehicle Adoption Accelerates: The EV segment experienced particularly high Y-o-Y growth, indicating growing mainstream adoption:
  • E-Three Wheelers: Increased by an impressive 324% Y-o-Y.
  • Electric Motor Cars: Rose by 158% Y-o-Y.
• Rural and Industrial Impetus: Infrastructure-related equipment and agricultural tractors also saw notable gains, driven by the arrival of Kharif crops (boosting rural activity) and mining activity.
• Market Outlook: The results were deemed “exceptional,” with industry experts focused on sustaining this momentum, although some moderation is anticipated in the coming weeks.