Automobiles – Monthly Update – Auto Sales Soar as Rain Pours
Published on 03 Aug 2026
Auto dispatches for Jul’26 continued the strong momentum with sustained retail demand, improving supply chain, and reduction in rainfall deficit that lifted rural sentiments. PVs reported growth in 30s, while 2Ws saw sustained growth with e-2Ws reporting continued surge in demand. PV inventory remained slightly higher at ~33 days at the end of Jun’26 vs. ~32/29 days at the end of May’26/Apr’26, and with the numbers reported so far, it seems to have inched further up at the end of Jul’26, even before the festive build-up starts. CV industry reported broadly strong performance from accelerating fleet replacement despite cost pressures. MHCV trucks were driven by infra-activities, government’s capex push and improved freight demand, while ILMCVs benefited from e-com and last-mile mobility demand. However, MHCV buses saw some moderation. Signs of recovery in monsoon (although the pattern remains mixed across regions) and acceleration in kharif sowing provided a fillip to rural sentiments. Tractors remained on strong growth trajectory, although there was a significant decline on MoM basis. While underlying rural fundamentals remain resilient, the progression of monsoon, kharif crop activities, delayed festive season in Q3 this year, ongoing input cost pressures, and an elevated base remain key monitorables.
