Two-wheeler sales soar to record high in Oct on GST cuts, festive demand

India's two-wheeler industry recorded its best-ever monthly sales in October 2025, buoyed by GST 2.0 rate cuts, festive buying and strong rural demand, with ICRA projecting steady growth for FY26.

India’s two-wheeler industry posted its strongest-ever monthly performance in October 2025, with retail sales rising 51.8 per cent year-on-year to an all-time high of 3.15 million units, according to data from rating agency ICRA. The surge comes after muted sentiment in September, which was impacted by the GST 2.0 transition.

 

The revised GST rates, combined with strong festive demand during Dussehra and Diwali, helped revive buying momentum sharply. Rural markets, buoyed by healthy farm incomes and a favourable monsoon, outperformed urban centres and contributed significantly to the growth.

 

Electric two-wheelers continued to hold steady in the overall mix. Sales grew 4 per cent to 1.44 lakh units, maintaining a 6–7 per cent share of total two-wheeler retail volumes. Despite a relatively high base, the segment’s penetration remains stable, supported by a widening selection of models, enhanced consumer awareness and improving charging infrastructure.

 

On the wholesale front, domestic dispatches registered a modest growth of 1.5 per cent to 2.1 million units, reflecting the impact of elevated base volumes in the same month last year. Manufacturers maintained healthy supplies to meet festive-season requirements, though the high base effect kept overall growth in check.

 

Exports reported a strong rebound, rising 17.8 per cent to 4.3 lakh units in October. Cumulatively, two-wheeler exports for April–October FY26 have grown 23 per cent year-on-year to 2.86 million units, aided by improved demand in key overseas markets and a favourable base.

 

Looking ahead, ICRA expects domestic two-wheeler volumes to grow 6–9 per cent in FY26, supported by replacement demand, strengthening urban sentiment and stable rural incomes. The industry is also expected to benefit from the GST 2.0 rate cuts, which have lowered acquisition costs, and from improving consumer confidence as macroeconomic conditions remain favourable.