Automobile exports grow 25%, stay consistent as domestic demand remained tepid in H1 2025

New Delhi: Despite the gloom of Trump’s trade tariffs last year, India’s automobile industry managed to boost its exports by 25% since last year, growing to 60 lakh units between April 25 to Febuary 26 from 48.1 lakh units during the same period last year. This has been the fastest growth pace in seven years, providing a vital cushion to the seasonality of domestic demand.

The Acche Din for Indian OEMs

Indian OEMs (Original Equipment Manufacturers) have successfully capitalized on recovering demand in Latin America, Southeast Asia, and parts of Africa. This export growth was particularly strong in the two-wheeler and passenger vehicle segments, where “Made in India” bikes, three wheelers and cars have offered the perfect balance of cost efficiency and modern features. 

GST 2.0: The lynchpin for domestic demand

The first half of 2025 remained tepid, as high interest rates deterred buyers, but all of that changed when the GST 2.0 was introduced in September, reducing taxes on most entry level cars and hybrid vehicles. Besides that, reduced interest rates also helped boost demand, revitalising the sector. 

“2025 has been a landmark year for the Indian Auto industry. The year began with a subdued first half, and the industry continued to navigate supply side challenges. With multiple structural policy reforms including the income tax relief, successive repo rate cuts and the rollout of GST 2.0 laid the foundation for a positive demand environment. The reduction of GST rates made vehicles more affordable and injected fresh momentum into the sector. Growth during the year has been broad-based across segments, with Passenger Vehicles, Commercial Vehicles and Three-Wheelers recording their highest ever sales and Two-wheelers posting the 2nd highest sales ever, in a calendar-year.

Passenger vehicles grew by 5.0 % in 2025 as compared to last year, with sales of around 45 Lakh units. Commercial Vehicles posted a growth of 7.7% in 2025 as compared to the previous year, with sales of 10.28 Lakh units. Three Wheelers registered a growth of 8.2% in 2025 as compared to the same period last year, with sales of 7.88 Lakh units. Two Wheelers crossed the 20-million-mark sales for the 2nd time in a calendar year with 20.50 million units, with a growth of 4.9% in 2025, though it is still below the peak it had achieved in 2018. In addition, exports witnessed double-digit growth across vehicle segments in 2025, compared to calendar year 2024,” Mr Shailesh Chandra, President, SIAM said in a press release.