India’s Auto Market Booms 34% After GST 2.0 Triggers Navratri Buying Wave

India's automobile retail sector has kicked off the festive season with unprecedented momentum, as reported by the Federation of Automobile Dealers Associations (FADA). September 2025 saw overall retail sales grow by 5.22% year-on-year, with a remarkable 34% spike during the Navratri period, driven by the timely rollout of GST 2.0 reforms on September 22. These reforms, which reduced rates and enhanced affordability, aligned perfectly with Navratri festivities, transforming the festival into what FADA Vice President Sai Giridhar called a "Bachat Utsav" (Savings Festival). The surge marks a historic high, with dealerships nationwide recording record-breaking footfalls and deliveries across major vehicle segments.

The month began on a subdued note, with sales remaining sluggish through the first three weeks as prospective buyers held off purchases in anticipation of the GST revisions. This wait-and-watch approach led to muted demand, but the landscape shifted dramatically in the final week when lower GST rates took effect amid Navratri celebrations. All vehicle categories, except three-wheelers and construction equipment, posted positive growth: two-wheelers rose 6.5% to approximately 1,200,000 units, passenger vehicles climbed 5.8% to 299,369 units, tractors increased 3.6% to 21,604 units, and commercial vehicles grew 2.6%. In contrast, three-wheelers declined 7.2%, and construction equipment fell 19%, reflecting sector-specific challenges.

During Navratri specifically, retail sales skyrocketed to 1.57 lakh vehicles, a 34% year-on-year increase, underscoring the powerful synergy between policy changes and cultural fervor. Giridhar highlighted this as a "Never Seen Before" moment, crediting Prime Minister Narendra Modi's visionary GST 2.0 for rejuvenating consumer sentiment and igniting nationwide enthusiasm. The reform not only unlocked pent-up demand but also boosted enquiries and bookings, particularly in two-wheelers and passenger vehicles, setting a buoyant tone for the 42-day festive calendar ahead.

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Dealers capitalized on the late-month surge to replenish inventories, with passenger vehicle stocks reaching around 60 days—positioning the industry for sustained growth through Dhanteras and Deepawali. This strategic buildup, combined with OEM schemes mirroring GST benefits, allowed customers to book vehicles early for auspicious deliveries, further amplifying the momentum. FADA's optimism is palpable, with expectations of all-time high sales in October, as the reforms continue to enhance affordability and confidence across urban and rural markets alike.

"This Navratri was not just a festival for consumers; it was a celebration for every dealer, every salesperson, and every worker in India’s mobility ecosystem," Giridhar emphasized, noting the policy's role in fostering national sentiment. As the sector gears up for peak festivities, the GST 2.0-driven revival signals a promising chapter for India's auto retail, blending economic reforms with traditional exuberance.

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