Sales of domestic automobiles in various vehicle segments witnessed a considerable upsurge, going up by 18.2% year on year to 83.88 lakh units in the July-September period of 2026. As per the statistics released by the Society of Indian Automobile Manufacturers, passenger cars, two-wheelers, three-wheelers, and commercial vehicles have managed to achieve their highest-ever quarterly sales numbers. This overall rise clearly depicts an expansion in the entire spectrum of the automotive industry in India in Q2 FY 2026-27.
Segment-wise performance and expansion
According to the Society of Indian Automobile Manufacturers (SIAM), the sales of passenger vehicles increased by 30.7% to 13.61 lakh units during the second quarter of the FY 2026-27. Two-wheeler sales improved by 15.2% to cross the mark of 64.33 lakh.
According to further checking, sales of three-wheelers jumped 23.6% to 2.85 lakh, while commercial vehicle sales increased by 28.7% to 3.09 lakh units. The second quarter witnessed robust recovery and growth in the market on a pan-Indian basis and was the best quarter for sales across all major segments, said Rajesh Menon, Director General of SIAM.
The utility vehicle class dominated the passenger vehicle market with a 68% share of overall sales. During the quarter, sales of utility vehicles rose 34.2% year-on-year, similar to an increase of 24.9% for passenger cars.
Scooters were the key driver of growth in the 2-wheel segment, as sales increased 27.7%, while motorcycle sales grew 7.4%. These trends reflect changes in customer preference for particular vehicles in separate segments.
Industry perspectives and export dynamics
The strong performance of the automotive sector is largely explained by a number of factors linked to macroeconomic and structural dynamics, according to the apex industry body. The overall growth was driven by favorable affordability due to GST 2.0, robust rural and urban demand, favorable freight movement, infrastructure-supported growth, and a staggered replacement cycle among vehicle segments. This constituted an enabling environment for both consumers and businesses to invest in new means of transport.
Results of export performance have been mixed across categories for the quarter. While 2-wheeler shipments have climbed 27.7% to 16.5 lakh units, the segment has recorded its highest-ever shipment volume in Q2. Three-wheelers grew by 30.4%, to ship 1.6 lakh units, while commercial vehicles surged by 72.5%, outpacing over 41,000 units.
At 2.29 lakh vehicles, a 5.2% drop, passenger vehicle exports were affected mainly by a higher base in the earlier periods and continued problems with logistics arising from the West Asia crisis. The Society of Indian Automobile Manufacturers anticipates the automotive market will experience positive growth momentum during the second half of the financial year 2026-27.
The upcoming festive season, new vehicle releases, continuing infrastructure investments, fleet renewal needs, and predictable last-mile mobility requirements are expected to contribute to this continuity. SIAM President Shenu Agarwal said the industry would continue to build on the positive trend, reacting positively to the festive season but remaining slightly positive yet cautious due to geo-economic uncertainties in the market.
Conclusion
The domestic auto sector’s performance during the second quarter of financial year 26-27 revealed impressive resilience and growth, with total sales clocking in at 83.88 lakh vehicles, marking record sales across all of the major vehicle categories. Structural catalysts such as improved affordability of products under GST 2.0, strong rural and urban demand, and infrastructure development have driven this growth, but industry leaders are watchful about possible moderators. With internal challenges already subdued, sector leaders start the second half of the fiscal year on an optimistic note, citing festive demand and economic drivers as some of the major positive external risks in the global inflation pathway.
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