India’s auto retail sales rise 7.7% in 2025 as demand rebounds in second half: FADA
- IBEF
- January 7, 2026
According to the Federation of Automobile Dealers Associations (FADA), automobile retail sales grew by 7.7% in 2025 because of increased consumer demand during the second half of the year. Improved consumer demand and the overall economic climate led to a significant increase in auto sales during the last quarter of 2025 compared with the first quarter of 2025. The rise in demand was primarily driven by stronger festive season sales and improved product availability following the removal of most existing supply chain restrictions within the industry. In addition to strong sales, FADA indicated that this increase in demand reflected high levels of consumer optimism about future economic conditions, resulting in higher overall vehicle purchases across multiple vehicle categories, despite a slow start to the year in terms of new vehicle sales.
During the second half of 2025, technological advancements and improved sales processes were attributed to increased consumer traffic and a corresponding improvement in sales conversion rates for dealers. Several contributing factors included new product introductions, competitive pricing strategies, and enhanced financing solutions available to consumers across both urban and rural geographic areas. According to FADA, sustained growth in retail vehicle sales confirms the ongoing strength of India’s automotive industry and demonstrates its continued ability to adapt to evolving market environments. Overall, the continued recovery in auto retail sales illustrates a long-term increase in consumer demand for automobiles, which should continue to create a favourable climate for automotive manufacturers and retailers.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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