FADA September 2026 Vehicle Retail Data Report

The Federation of Automobile Dealers Associations (FADA) released vehicle retail data for September 2026, reporting the best-ever September performance in Indian auto retail history. Total vehicle retails reached 25,36,920 units, representing a 31.82% year-on-year increase and a 4.69% month-on-month growth. The first half of FY'27 (April-September) also achieved a record high of 1,55,12,319 units, up 20.77% year-on-year.

Category Performance Breakdown

Two-wheeler sales reached 17,90,188 units (+33.08% YoY, +4.41% MoM), marking the best-ever September and standing 15.3% above the pre-Covid September 2018 peak. Passenger vehicle sales were 4,27,213 units (+32.10% YoY, +6.17% MoM), also a record September. Commercial vehicles crossed the one-lakh mark in September for the first time at 1,03,557 units (+37.62% YoY, +14.09% MoM). Three-wheeler sales reached 1,32,570 units (+22.25% YoY, +8.41% MoM), while tractors recorded 76,906 units (+13.75% YoY, -12.58% MoM). Wheeled construction equipment saw a sharp rebound to 6,486 units (+38.00% YoY, +25.55% MoM).

Market Dynamics and Trends

The 31.82% year-on-year growth is considered the most base-distorted print of the year, reflecting the impact of last September's pre-GST 2.0 purchase deferrals. The cleaner underlying signals are the 4.69% month-on-month growth and an approximate 17% run-rate excluding the distorted September effect. The fuel mix showed petrol nudging marginally ahead at 41.27% against alternative fuels at 41.00% (CNG 23.11%, Hybrid 9.44%, EV 8.45%), indicating the August crossover was an inflection rather than a decisive flip. Total EV retails reached an all-time monthly high of approximately 3.34 lakh units, with overall EV penetration at roughly 13%. Two-wheeler EV penetration specifically reached 11.58%, while three-wheeler EV penetration stood at 64.90%.

Inventory and Regional Performance

Passenger vehicle inventory rose by a further 5 days over August-end to approximately 43-45 days, well above FADA's recommended 21-day benchmark, with 60% of PV dealers holding higher stock due to upcoming festivals. Regionally, rural areas led year-on-year growth across most categories, but the sequential festive pickup was urban-led. Tractors were the lone soft spot, declining 12.58% month-on-month due to a late festive calendar and patchy monsoon performance in some regions.

Outlook and Sentiment

For October 2026, 75.57% of dealers expect growth (up from 67.09% for September), 19.46% expect a flat market, and 4.98% expect de-growth. The outlook is categorized as 'Cautiously Optimistic' with expectations that festive demand held back during Pitru Paksha will convert into concentrated deliveries from mid-month during Navratri (11-20 October) and Dussehra. For the October-November-December 2026 period, 78.28% of dealers expect growth, with 49.5% having revised their FY'27 outlook upward after the record first half performance. However, the quarter faces a demanding base as it laps the first full quarter after GST 2.0 implementation, and affordability remains the key concern as successive price increases threaten to erode the GST benefit that has driven the current cycle.

Additional Survey Findings

Member surveys showed 48.42% reporting good liquidity, 41.18% neutral, and 10.41% bad liquidity. Sentiment was reported as good by 58.37%, neutral by 36.20%, and bad by 5.43% of respondents.