Auto Sector

India’s passenger vehicle market witnessed a sharp slowdown in August, with sales falling 9 percent year-on-year, according to the Society of Indian Automobile Manufacturers (SIAM). The decline reflects weaker consumer sentiment, rising ownership costs, and subdued demand in both urban and rural markets. While automakers had anticipated festive-season optimism, the August figures highlight challenges such as high interest rates, inflationary pressures, and uneven monsoon rainfall impacting rural purchasing power.

TVS Motor Company is poised to benefit from the recent cut in Goods and Services Tax (GST) rates on two-wheelers, with analysts expecting a surge in consumer demand. The tax reduction is likely to improve affordability, especially in price-sensitive segments, and stimulate rural and urban sales alike. Industry experts believe that the move could revive growth momentum in India’s two-wheeler market, which had been subdued by high fuel prices and inflationary pressures.

Mahindra & Mahindra Ltd. (M&M), one of India’s leading automakers, finds itself at a critical juncture as it navigates robust earnings, supportive tax reforms, and shifting consumer trends against the backdrop of new fuel mandates. The company reported a double-digit surge in quarterly profit, boosted by strong SUV sales and market share gains. The recent implementation of GST 2.0 has allowed Mahindra to cut vehicle prices significantly, enhancing its competitive edge.

The Indian government has slashed the Goods and Services Tax (GST) on motorcycles and scooters with engine capacities up to 350cc from 28% to 18%, effective September 22, 2025. This move is expected to lower vehicle prices significantly, making two-wheelers more affordable for middle-class consumers and stimulating demand in the automotive sector. Leading manufacturers such as Honda, Hero MotoCorp, and Yamaha have announced price reductions of up to ₹18,887 on select models. The measure also aims to boost sales ahead of the festive season while supporting broader economic growth.

Hyundai has taken another decisive step in the electric mobility race with the unveiling of its latest prototype, the Concept Three, a compact electric car designed for city commuting. The model emphasizes sustainability, affordability, and cutting-edge technology, underscoring the automaker’s strategy to capture a wider consumer base in the growing electric vehicle (EV) segment.

The Goods and Services Tax (GST) regime continues to weigh heavily on the Indian two-wheeler industry, with motorcycles and scooters falling under the highest GST slab of 28%. Industry representatives argue that treating essential mobility vehicles on par with luxury goods undermines affordability for millions of consumers, particularly in rural and semi-urban areas where motorcycles remain a lifeline. Rising fuel prices and inflation have already dampened sales, and the additional tax burden has further constrained recovery.

India’s automobile retail sector reported steady growth in August, supported by early festive season purchases, improving rural demand, and sustained momentum in passenger vehicle sales. Two-wheelers, which had been under pressure for several quarters, showed signs of revival, while commercial vehicles maintained stable performance. The Federation of Automobile Dealers Associations (FADA) noted that positive monsoon progress, easing inflation, and renewed consumer sentiment contributed to the uptick. However, supply chain pressures and cautious financing trends remain areas of concern.

Maruti Suzuki has expanded its product portfolio with the launch of Victoris, a new sport utility vehicle (SUV) designed to capture growing demand in India’s most competitive automotive segment. Equipped with advanced safety systems, connected technology, and a modern powertrain, Victoris marks a significant step in the company’s strategy to consolidate its presence in the mid-size SUV category.

Tata Motors has announced a broad reduction in prices across its passenger vehicle portfolio, including cars and SUVs, in an effort to make its offerings more accessible to consumers. The move comes at a time when the automotive industry is navigating high input costs, subdued demand in certain segments, and intense competition. By revising prices downward, Tata Motors aims to consolidate its market position, stimulate sales momentum ahead of the festive season, and appeal to value-conscious buyers who have been deterred by rising vehicle ownership costs.

Skoda India is offering significant price reductions on its key models following the recent Goods and Services Tax (GST) cut, providing customers with savings of up to Rs. 5.8 lakh. The benefits apply across popular models including the Kushaq, Slavia, and Kodiaq, enhancing affordability and potentially boosting demand in both compact and premium segments. Coupled with additional manufacturer incentives and financing schemes, these reductions make Skoda’s offerings more competitive against rivals.