Domestic Auto Sales Drop 4% in July 2025 as PV and 2-Wheeler Demand Weakens

Domestic automobile retail sales declined 4% year-on-year in July 2025 due to softer demand for passenger vehicles and 2-wheelers, according to the Federation of Automobile Dealers Associations (FADA). Total vehicle registrations dropped to 19,64,213 units from 20,52,759 units in July 2024, attributed largely to the high-base effect.

Passenger Vehicle Sales See Modest Decline to 3,28,613 Units

Passenger vehicle (PV) sales fell marginally to 3,28,613 units from 3,31,280 units a year ago. FADA noted that whilst auspicious delivery dates, targeted schemes, and rural marketing supported hinterland demand, urban sentiment remained muted amid cautious consumer behaviour. Inventory levels stabilised at around 55 days, with dealers calling for calibrated discounting and enhanced urban outreach.

2-Wheeler Registrations Drop 6% on Rural Weakness

2-wheeler registrations declined 6% year-on-year to 13,55,504 units in July 2025. FADA attributed the decline to weakened rural footfall due to ongoing sowing activities and extended heavy rainfall, which disproportionately affected demand outside urban centres. However, dealers expressed optimism for post-monsoon recovery as potential buyers deferred purchases to August ahead of festivities.

Read More: Auto Sales July 2025: Which Company Sold the Most 4 Wheelers in India?

Commercial Vehicles Post Marginal Growth to 76,439 Units

Commercial vehicle retail sales edged up to 76,439 units from 76,261 units previously. Urban demand, aided by new model launches, institutional orders, strong marketing, and timely stock availability, drove marginal growth. Targeted schemes pushed school bus sales, whilst rural demand remained fragmented due to seasonal weakness in cement, coal, and construction logistics.

Tractor Sales Jump 11% Amid Favourable Monsoon Conditions

Tractor registrations rose 11% year-on-year to 88,722 units in July 2025. FADA cited the timely release of enhanced agricultural subsidies, favourable monsoon conditions, and improved rural liquidity as factors driving increased purchase intent.

Conclusion

Auto sales' 4% decline to 19,64,213 units in July 2025 reflects mixed sectoral performance with passenger vehicles and 2-wheelers facing demand challenges whilst tractors surge 11% on agricultural support. 

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