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Indian Auto Sector Sees Strong Sales Surge in February 2026

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  Published in Automotive and Transportation on Wednesday, February 25th 2026 at 7:52 GMT by Zee Business
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Mumbai, February 25th, 2026 - The Indian automotive sector is showing strong signs of continued recovery and growth, with preliminary data for February 2026 pointing towards a significant uptick in sales. According to a recent report by financial services firm Nuvama, passenger vehicle (PV) sales are expected to rise by more than 10% compared to February 2025. However, the real story appears to be in the two-wheeler segment, which is forecast to experience a substantial 30% year-on-year increase. This robust growth suggests a strengthening consumer sentiment and a potential shift in transportation preferences across the country.

Nuvama's projections, released earlier today, have been welcomed by industry analysts, who view them as confirmation of the positive momentum building within the Indian auto market. While the sector faced headwinds in recent years due to factors like the global chip shortage, pandemic-related disruptions, and economic uncertainty, it is now benefiting from a confluence of favorable conditions.

Driving Forces Behind the Growth

Several key factors are contributing to this anticipated surge in sales. The 'base effect' - comparing sales figures to a relatively weaker period last year - is undoubtedly playing a role. February 2025 experienced slower sales due to ongoing supply chain issues, making the comparison exceptionally positive this year. However, the growth isn't solely attributable to statistical anomalies.

The tail end of the festival season, particularly the lingering impact of Makar Sankranti and Valentine's Day promotions, continues to provide a boost. Automakers launched a variety of promotional offers and discounts during these periods, incentivizing purchases. Furthermore, early indications suggest a potential improvement in rural demand. Monsoon season performance in 2025 was largely positive in many key agricultural regions, leading to higher disposable incomes for rural consumers, who represent a significant portion of the two-wheeler market.

SUVs Continue to Dominate PV Growth

Within the PV segment, the trend towards Sport Utility Vehicles (SUVs) is expected to persist. Nuvama analysts predict that SUVs will continue to be the primary driver of overall PV growth, accounting for a larger share of total sales compared to hatchbacks and sedans. This preference for SUVs reflects changing consumer tastes and a desire for vehicles that offer a combination of space, comfort, and perceived safety. Manufacturers have responded to this demand by expanding their SUV portfolios, offering a wider range of models and price points.

The increasing availability of locally manufactured components and a gradual easing of the chip shortage have also enabled automakers to ramp up production and reduce waiting periods for popular SUV models. This improved supply situation is crucial for sustaining the growth momentum.

Two-Wheeler Surge: A Sign of Economic Recovery?

The projected 30% increase in two-wheeler sales is particularly noteworthy. Two-wheelers are often seen as a bellwether for economic activity, as they are typically the first major purchase for many households. The significant growth in this segment suggests that consumer confidence is improving, and that individuals are willing to make discretionary purchases.

Analysts also point to the increasing affordability of two-wheelers, coupled with the rising cost of fuel and public transportation, as contributing factors. Electric two-wheelers are also gaining traction, driven by government incentives and growing environmental awareness. While still a relatively small portion of the overall two-wheeler market, the electric segment is expanding rapidly and is expected to contribute significantly to future growth.

Looking Ahead

The positive outlook for the Indian auto sector is expected to continue in the coming months. However, several challenges remain, including fluctuating raw material prices, geopolitical uncertainties, and the potential for interest rate hikes. Automakers will need to carefully manage these risks to maintain their growth trajectory.

Nuvama's report underscores the resilience of the Indian auto sector and its potential for long-term growth. The combination of favorable macroeconomic conditions, changing consumer preferences, and increasing product innovation is creating a promising environment for automakers and consumers alike. The firm will be releasing a more detailed analysis of the February sales figures next week, providing further insights into the performance of individual manufacturers and segments.