Federation of Automobile Dealers Associations (FADA) released its January 2026 vehicle retail data, reporting a robust 17.61% year-on-year (YoY) growth in overall retail sales at 27,22,558 units, signaling a broad-based recovery anchored in rural demand, improved affordability, and policy tailwinds.
Announcing the data in New Delhi, FADA President C S Vigneshwar said January marked a strong start to the calendar year, supported by healthy rural cash flows from harvest season and weddings, post-GST momentum, and sustained mobility and freight demand.
Two-Wheelers Lead the Charge; Urban Revival Gains Pace
The two-wheeler (2W) segment emerged as the strongest contributor, clocking 18,52,870 units, up 20.82% YoY.
- Rural contribution stood at ~56%, while urban share was ~44%.
- Rural sales grew 19.77% YoY, aided by Pongal and Makar Sankranti festivities.
- Urban growth outpaced rural at 22.19% YoY, indicating demand normalization beyond festive buying.
Market leader Hero MotoCorp Ltd retained the top spot with 26.56% market share, followed by Honda Motorcycle and Scooter India Pvt Ltd (25.52%) and TVS Motor Company Ltd (19.66%).
Dealers highlighted stronger enquiry momentum, sharper digital follow-ups, and a shift toward higher-value motorcycles. However, selective supply constraints and aggressive discounting remain challenges.
Passenger Vehicles Expand Beyond Metros
The passenger vehicle (PV) segment recorded 5,13,475 units, up 7.22% YoY.
- Urban share: ~59.2%
- Rural share: ~40.8%
- Rural PV growth: 14.43% YoY
- Urban PV growth: 2.75% YoY
FADA noted that growth momentum is increasingly shifting toward non-metro markets, driven by SUV and compact-SUV demand, entry-level revival, improved product availability, and schemes. Inventory levels softened to a healthier 32–34 days, reflecting improved channel discipline.
In OEM rankings, Maruti Suzuki India Ltd led with a 42.07% share, followed by Hyundai Motor India Ltd, Tata Motors Ltd, and Mahindra & Mahindra Limited.
Commercial Vehicles Gain on Freight and Infra Push
Commercial Vehicles (CV) retail stood at 1,07,486 units, registering 15.07% YoY growth.
- LCV: 65,505 units (+14.94%)
- HCV: 34,287 units (+14.61%)
- Rural CV growth: +16.25%
- Urban CV growth: +13.94%
The segment benefited from improving freight sentiment, infrastructure activity, and replacement-led buying. Tata Motors Ltd maintained leadership with 34.02% share, followed by Mahindra & Mahindra Limited and Ashok Leyland Ltd.
Tractors Shine; Construction Equipment Under Pressure
Tractor sales surged 22.89% YoY to 1,14,759 units, reflecting strong rural liquidity and agricultural momentum.
Conversely, Construction Equipment (CE) declined 21.09% YoY to 6,834 units, primarily due to a high base effect and segment recalibration.
Fuel Mix: EVs Gain in 3W, Stable in PV
- EV share in three-wheelers stood at 59.61%, reflecting strong electrification.
- Passenger vehicle EV penetration rose to 3.60%.
- Diesel remained dominant in CVs (81.97%) and tractors (~100%).
Dealer Sentiment Remains Optimistic
According to FADA’s member survey:
February 2026 Expectations
- Growth: 72.56%
- Flat: 22.93%
- De-growth: 4.51%
Next 3 Months Outlook
- Growth: 79.70%
- De-growth: 1.88%
Dealers cited supportive macros, infrastructure thrust in the Union Budget, stable interest rates, wedding season demand, and improved booking pipelines as key enablers.
Outlook: Broad-Based Growth with Watchpoints
FADA expects continued momentum across segments in the near term, though challenges such as high base effects, election-related disruptions in select states, selective supply constraints, and discount intensity warrant monitoring.
Overall, the industry outlook for February and the next quarter remains positive to optimistic, with structural expansion of demand beyond metro markets emerging as a defining trend of 2026.
