New Delhi: India’s auto industry wrapped up FY 2024–25 on a strong note, driven by steady demand, expanding exports, and growing interest in electric mobility. Several factors came together—new launches, infrastructure development, and policy support—to keep things moving forward. Tata Motors remained in the spotlight as vehicle sales, especially in the passenger and two-wheeler segments, held firm through the year.
Passenger vehicles see record sales and exports
Passenger vehicle (PV) sales reached a new peak with 4.3 million units sold, the highest ever recorded for the segment. While overall growth was modest at 2%, it was significant considering the high base of the previous year. Utility vehicles (UVs) stood out, now accounting for around 65% of total PV sales, up from about 60% last year.
Much of this momentum came from fresh model launches packed with new features and styling that appealed to changing buyer preferences. Offers and easy financing helped too, making it easier for consumers to go ahead with their purchases despite inflation pressures.
Exports added to the upbeat performance. Overseas shipments of PVs rose by 14.6% to 0.77 million units. Indian-made models found good traction in Latin America, Africa, and even select developed markets, underlining India’s growing role in global auto exports.
Two-wheelers rebound on rural demand and product upgrades
The two-wheeler segment showed strong recovery, clocking 19.6 million units in sales—up 9.1% over the previous year. Rural and semi-urban markets played a key part in this, thanks to improved road networks and rising disposable incomes.
Scooters, in particular, saw a good pickup. Newer models with added features appealed to a broader customer base. Electric variants made a mark too, with EVs now accounting for over 6% of total two-wheeler sales.
Exports also told a positive story. Around 4.2 million two-wheelers were exported, showing a growth of over 21%. Buyers in Africa and Latin America drove much of this demand, with Indian brands offering reliable and value-driven models suited to these markets.
Three-wheelers gain ground with last-mile demand
Three-wheelers had a strong run in FY 2024–25, recording sales of 7.4 lakh units—their best performance yet. That was a 6.7% rise over the year before. The boost came mainly from rising demand for passenger variants and electric models in urban centres.
Factors like better loan access, increased last-mile delivery needs, and city-focused transport schemes gave this segment a push. On the export side, growth was steady at 2.3%, with around 3.1 lakh units shipped out.
Commercial vehicles see mixed performance
Commercial vehicles (CVs) saw a marginal dip of 1.2% in overall sales. But there were signs of improvement towards the end of the fiscal year, with the final quarter showing a 1.5% uptick. The drop in truck sales came partly due to an earlier high base and shifting logistics needs.
Still, growth was visible in the bus segment, supported by rising demand for public transport across cities. Expanding highways and urban transit investments added momentum. CV exports showed strong performance, rising by 23% to 0.81 lakh units.
Electric mobility picks up further
Electric vehicle (EV) adoption continued to rise across categories. Total EV registrations stood at 1.97 million units—up nearly 17% over the previous year. Break-up figures include:
- Over 1 lakh electric passenger vehicles (18.2% growth)
- 5 lakh electric two-wheelers (21.2% growth)
- Close to 7 lakh electric three-wheelers (10.5% growth)
Government initiatives like the Electric Mobility Promotion Scheme and the launch of new EV models played a key role in pushing adoption. Supportive policies and expanding awareness helped electric mobility become a mainstream choice for many buyers.
Market spotlight on Tata Motors and auto stocks
Among listed auto companies, Tata Motors drew particular attention. Strong domestic performance, exports, and an expanding EV line-up have made it one of the most followed stocks in the segment. Its role in electric mobility and success in overseas markets has added to investor confidence.
More broadly, auto stocks gained traction among both retail and institutional investors. With solid fundamentals and future-ready innovation, several companies in the sector became part of long-term investment strategies.
For individuals looking to participate, opening a demat account online is a simple starting point. Most platforms now offer easy, paperless onboarding and direct access to auto and EV shares.
Looking ahead: outlook for FY 2025–26
The coming year is expected to build on this momentum. A favourable monsoon forecast is likely to support rural demand. The Union Budget’s reforms, especially changes in personal income tax and recent rate cuts by the Reserve Bank of India, could help boost vehicle financing and make ownership more accessible.
Infrastructure projects and an ongoing shift towards EVs will also continue shaping the landscape. Export demand looks stable, particularly from regions like Africa and South Asia, where ‘Made in India’ vehicles are gaining reputation for quality and affordability.
As new schemes like PM E-Drive and PM e-Sewa get implemented, more buyers are expected to turn to electric options. Investments in charging infrastructure and greater EV visibility on roads will likely support this trend.
Conclusion: steady growth and strong fundamentals
FY 2024–25 marked another successful year for India’s auto industry. The sector showed resilience across segments, from personal mobility to last-mile delivery and exports. Record sales in several categories, rising EV adoption, and favourable economic conditions all contributed to the momentum.
With demand staying firm and policies remaining supportive, the industry enters FY 2025–26 with a strong foundation. For investors, especially those tracking companies like Tata Motors, this presents an opportunity to be part of a sector that is both growing and evolving with the times.
