Automobiles – Monthly Update – Cautiously Optimistic amid Geopolitical Tensions
Published on 03 Jun 2026
Auto dispatches in May’26 saw sustained volume growth across most segments, although some sub-segments saw moderation. PVs reported growth in 20s, while 2Ws saw stable growth as most OEMs are in the midst of increasing capacities to meet the sustained retail demand while mitigating labor shortages, and disruptions in logistics and supply chain. CV industry reported mixed performance with subdued growth seen for MHCVs, while LCVs continued strong momentum. CV industry is expected to see short-to-medium term moderation due to elevated fuel/ RM prices, although OEMs are optimistic about the structural long-term growth drivers, which are replacement demand and infra spending. Tractors continued on a strong growth trajectory with adequate reservoir levels and resilient rural demand. However, progression of monsoon and input cost inflation will be key monitorables.
