As consumers expecting GST reductions, India’s passenger car sales dropped 9% to 3.2 lakh units in August 2025, according to Siam.
Scooters drove a 7% increase in two-wheeler sales to 18.3 lakh units, while three-wheelers saw record August deliveries. Sales may rebound from the fall in the GST rate due to festive demand.
Manufacturers sent 321,840 passenger cars to dealerships in August, a 9% decrease from the 352,921 vehicles sent the previous year. The Society of Indian Automobile Manufacturers (Siam) attributed the reduction mostly to businesses modifying supply levels to match muted market demand.
Customers postponed purchases last month in expectation of a drop in GST rates, which would probably result in lower car pricing, according to Siam Director General Rajesh Menon. Because of this buyer caution, manufacturers had to reduce their wholesale quantities, which had an impact on passenger vehicle sales.
Resilient two- and three-wheelers
On the other hand, two-wheelers showed a tendency toward better health. This category’s dispatches increased from 17,11,662 units in August 2024 to 18,33,921 units, a 7% year-over-year increase. Motorcycles had a more moderate 4% increase at 11,06,638 units, while scooters saw a more dramatic 13% gain to 6,83,397 units.
With 75,759 units shipped in August—an 8% increase over the 69,962 units sent in the same month the previous year—three-wheelers again had a great showing. This was the biggest number the segment has ever published for the month of August.
The GST decrease might increase demand for the holidays
Menon predicted that the government’s recent decision to lower the GST on automobiles will boost demand over the holiday season. Cars with gasoline or diesel engines up to 1,200 or 1,500cc will be subject to 18% GST starting on September 22. Larger vehicles will continue to be subject to 40% GST, while electric vehicles will continue to be subject to 5%.