India’s auto industry showed mixed trends in June 2025, with strong export growth across two-wheelers, passenger vehicles, and commercial vehicles, while domestic sales remained uneven. According to Axis Securities, export momentum is expected to continue, with moderate growth forecast for FY26.
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Check Offers The Indian automotive industry has sustained its growth momentum from the success of exports in its main segments- two-wheelers (2W), commercial vehicles (CV), and passenger vehicles (PV)- even as domestic sales have been more uneven, or mixed. According to a report released by Axis Securities for June 2025, the outstanding overseas demand continues to be a strong engine for growth, but homegrown consumption demonstrates different patterns for categories and manufacturers.
Two-wheeler exports shine amid domestic slowdown
The two-wheeler segment registered a marginal 2 per cent growth in overall wholesale volumes in June 2025. However, this uptick was almost entirely fueled by a striking 35 per cent year-on-year (YoY) rise in exports. Domestic sales, on the contrary, decreased by 3 per cent YoY, indicating a discord between the development of global and local markets.
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The report also noted an increase in Q1FY26 two-wheeler exports of 22 per cent, while domestic volumes for the quarter were down by 6 per cent YoY. Axis Securities noted that the segment’s outlook could improve on the back of several upside triggers such as a rural demand revival, new model launches, favourable fiscal policies, and restocking by manufacturers.
Passenger vehicle sales dip but exports surge
Domestic passenger vehicle sales declined by 7–8 per cent YoY in June 2025, driven by weaker performances from key players like Hyundai, Tata Motors, and Maruti Suzuki. But firms like Mahindra & Mahindra, JSW MG, and Toyota posted decent growth, which muted the general decline.
In spite of the softness at home, exports in the segment continued to be a hope. Maruti Suzuki was the pace-setter with a 37 per cent increase in overseas sales, followed by Tata Motors (68 per cent), Hyundai (13 per cent), and Mahindra (36 per cent). As a result, PV exports are expected to sustain growth, while domestic volumes are projected to expand in the low-to-mid single-digit range in FY26.
Also Read : Maruti Suzuki clocks 6 per cent sales decline in June 2025, exports cushion the blow
CV segment flat
The commercial vehicle segment saw a 2 per cent YoY dip in Q1FY26 wholesale volumes, largely due to declines from Tata Motors (-9 per cent) and flat performance from Ashok Leyland. Yet, VECV, M&M, and Maruti gained 9 per cent, 4 per cent, and 7 per cent respectively.
Whereas Axis Securities has a conservative view of CVs—anticipating flat to low single-digit growth—it is expecting the bus sub-segment to drive hope in the face of increasing demand in public and institutional transportation.
The report indicates that exporting markets are still likely to be the growth driver for India’s auto space over the near term. Domestically, performance will depend on consumer attitudes, favourable trends in the rural economy, and regulatory support. With segments showing mixed trends, automakers may have to rethink strategies to sustain the momentum both in the domestic and export markets.
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First Published Date: 06 Jul 2025, 08:00 AM IST
