New Delhi [India], July 15 (ANI): Passenger Vehicles and Two-Wheelers sales are expected to experience an uplift, helped by the upcoming festive season typically serves as a demand driver, according to the recent report by the Society of Indian Automobile Manufacturers (SIAM).

Additionally, the report reveals that an above-normal monsoon is likely to aid rural income recovery, which is expected to be a positive signal for two-wheelers and entry-level vehicles that rely heavily on rural demand.

The auto sector is expected to witness improved affordability and boosted consumer sentiment in the coming months, boosted by the RBI's cumulative repo rate cuts of 100 basis points over the past six months are expected to gradually ease borrowing costs.

However, supply-side challenges, particularly China's export licensing requirement for rare earth magnets, remain a concern for OEMs.

The report also highlights that the passenger vehicle segment crossed a milestone of 1 million mark in Q1 of 2025-26, specifically 1.01 million units. This is the 2nd time in a row in Q1 in the last 2 years that the sales for passenger vehicles crossed the 1 million mark.

According to the report, the Utility Vehicles (UVs) continued to drive the passenger vehicle segment, growing to 66 per cent market share and posting a 3.8 per cent growth in Q1 2025-26.

In contrast, passenger cars experienced an 11.2 per cent degrowth. Passenger vehicle exports hit a record 2.04 lakh units in Q1 2025-26, a 13.2 per cent increase, fuelled by strong demand in the Middle East and Latin America, and revival in neighbouring and FTA markets.

The Two-Wheeler segment recorded 4.67 million units in Q1 2025-26, a 6.2 per cent de-growth, attributed to inventory correction. Despite wholesale declines, retail registrations for two-wheelers rose by 5 per cent in Q1 due to the marriage season and positive demand. Two-wheeler exports also saw significant growth of 23.2 per cent, reaching 1.14 million units.

Three-wheelers achieved their highest-ever Q1 sales at 1.65 lakh units in 2025-26, a marginal 0.1 per cent growth, primarily driven by the Passenger Carrier sub-segment and increased economic activity. Exports in this segment grew by 34.4 per cent. Commercial Vehicles experienced a marginal 0.6 per cent degrowth in Q1, with sales of 2.23 lakh units, though exports grew by 23.4 per cent. (ANI)