According to FADA, a total of 31,72,466 vehicles were sold at retail in October 2026. While this was significantly higher than September's sales, it remained below the figures recorded in October last year.
FADA said the October numbers need to be assessed in the context of the festive calendar and the unusually high comparison base from 2025. Last year, both Navratri and Diwali fell in October. In addition, demand had increased following the reduction in GST rates on September 22, 2025, boosting vehicle sales during the month.
This year, Navratri was celebrated in October, while Dhanteras and Diwali fall in November. As a result, a substantial portion of festive vehicle purchases is expected to shift to the current month.
Festival Calendar Changes Vehicle Sales Pattern
Vehicle retail sales in October 2026 increased by nearly 25% compared with September, indicating an improvement in monthly demand. According to FADA, the increase reflects the impact of festive buying activity.
However, sales in October 2025 had benefited from Diwali purchases and the demand generated after the GST rate reduction, creating a significantly higher base for comparison.
This year, Dhanteras falls on November 6 and Diwali on November 8. FADA expects some of the purchases postponed from October to be reflected in November's sales figures. However, the actual extent of this increase will become clearer only after the November retail sales data is released.
Despite the year-on-year decline, October 2026 recorded the second-highest vehicle retail sales for the month in the country's history. Commercial vehicles, three-wheelers and tractors also registered their highest-ever October sales in their respective segments.
Vehicle Sales Across Different Segments
FADA's October 2026 data showed varying trends across vehicle categories, with differences in both annual and monthly performance.
Two-wheelers accounted for the largest share of vehicle sales, with 23,21,419 units sold during October. This represented a 28.35% decline compared with October last year. However, sales increased 29.67% compared with September 2026. FADA said the two-wheeler segment is particularly sensitive to festive purchases and rural demand.
Passenger vehicles, including cars and SUVs, recorded retail sales of 5,07,768 units. Sales declined 14.23% year-on-year but increased 18.86% compared with September. October 2026 also recorded the third-highest passenger vehicle retail sales ever for the month.
The commercial vehicle segment, including trucks and other commercial vehicles, recorded sales of 1,15,140 units. This represented a 2.29% annual increase and an 11.19% rise compared with the previous month. According to FADA, demand for medium and heavy commercial vehicles supported the segment's performance.
Three-wheeler sales stood at 1,41,420 units in October. Sales increased 3.97% year-on-year and 6.68% month-on-month. The segment registered its highest-ever retail sales for October.
Tractor sales reached 79,285 units, marking an increase of 3.10% compared with October last year and 3.09% compared with September. FADA attributed the segment's performance to continued support from rural demand.
Wheel construction equipment recorded retail sales of 7,434 units. This was 22.07% higher than the corresponding period last year and 14.62% above September's figures.
Rural Markets Record Steeper Decline in Two-Wheeler Sales
FADA's data highlighted a sharper year-on-year decline in two-wheeler sales in rural markets than in urban areas.
Rural two-wheeler sales fell 33.97% in October compared with the same month last year. The decline in urban markets stood at 20.77%.
In the passenger vehicle segment, rural retail sales declined 12.44% year-on-year, while urban sales registered a 15.30% drop.
Overall vehicle retail sales in rural markets decreased 28.59%, compared with an 18.07% decline in urban markets.
According to FADA, rural markets and northern India could witness an improvement in November following the weaker sales recorded in October.
Electric Vehicle Sales Set a New Record
Electric vehicle retail sales reached approximately 3.55 lakh units in October 2026, marking their highest-ever monthly level, according to FADA.
The segment recorded year-on-year growth of 44.88%, with electric vehicles accounting for approximately 11.5% of total vehicle retail sales. Their share stood at around 6% in October last year.
Electric three-wheelers recorded particularly strong penetration, with electric models accounting for 62.63% of total three-wheeler sales. This means nearly 63 out of every 100 three-wheelers sold during the month were electric.
The passenger vehicle segment also witnessed a shift in the fuel mix.
In October, petrol and ethanol-powered vehicles accounted for 41.60% of passenger vehicle sales. Meanwhile, vehicles powered by CNG, LPG, hybrid technology and electricity collectively accounted for 41.83%.
This meant the combined share of alternative-fuel passenger vehicles was slightly higher than that of petrol-powered vehicles during the month.
Dealers Expect November Sales to Improve but Remain Cautious
According to FADA's online members' survey, 51.65% of dealers expect vehicle sales to increase in November 2026. Another 34.71% anticipate sales remaining stable, while 13.64% expect a decline.
With Dhanteras and Diwali falling in November, dealers are expecting festive purchases to support retail demand.
FADA expects rural markets and northern India to contribute to a potential recovery. However, dealers remain cautious about several factors, including a possible slowdown in demand after the festive season, vehicle availability and rising EMIs.
Around 31% of dealers surveyed by FADA said an increase in interest rates could affect vehicle financing costs and monthly instalments.
What to Expect from Vehicle Sales Over the Next Three Months?
Dealers have maintained a cautiously optimistic outlook for vehicle sales between November 2026 and January 2027.
In FADA's survey, 50.41% of dealers expected sales to increase over the next three months. Meanwhile, 40.08% anticipated stable sales, while 9.50% expected a decline.
Dealers believe year-end offers following Diwali, the introduction of new models and improved vehicle availability could support sales during this period.
Rural demand and the impact of EMIs are expected to remain important factors for the two-wheeler segment.
Overall, October's vehicle retail sales figures reflect the combined impact of a high comparison base in 2025 and the shifting festive calendar in 2026. While the year-on-year decline remains significant, the monthly recovery, record sales in selected segments and growing electric vehicle penetration will make November's figures important in assessing the direction of India's automobile retail market.
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