Ajinkya Firodia, Vice Chairman and Managing Director of Kinetic Watts & Volts Ltd., said 2025 was a defining year for India’s electric scooter ecosystem.EV penetration in scooters crossed an all-time high of 16 per cent during the year. Also policy support, including the reduction of GST from 28 per cent to 18 per cent, as a positive catalyst for the broader automobile market, which continued to grow despite global conflicts, tariff uncertainties and economic volatility.
As 2025 draws to a close, India’s automotive and mobility sector has emerged more resilient and future-focused, marked by strong premiumisation trends, deeper electric vehicle (EV) consolidation, and a growing emphasis on engineering-led innovation, according to industry leaders.
Despite global geopolitical uncertainties, supply-chain disruptions and cost pressures, the sector maintained steady growth through capacity expansion, technology integration and evolving consumer preferences, positioning India as a key long-term mobility market heading into 2026.
According to a report by PhillipCapital India, demand remains robust across multiple segments, including passenger vehicles, two-wheelers, and commercial vehicles, bolstered by the recent GST cut and strong rural sentiment.
While entry-level cars have shown signs of recovery, customer preference remains heavily skewed toward vehicles with premium features and higher safety ratings.
The report notes that “the trend should continue to favor towards premiumization, SUVs & alternate fuel.”
Maruti Suzuki said that it expects “around 10 per cent YoY growth during January-March as supply of small cars improves.”
The commercial vehicle and tractor segments are also showing steady signs of improvement. Small commercial vehicles are leading a recovery in their sector after facing previous affordability challenges, while tippers have bounced back following an extended monsoon season.
In the agricultural space, tractor sales remain healthy despite December being a typically weak season. This growth is driven by state subsidies, favourable crop prices, and strong “rural sentiment,” according to the report.
Highlighting the transformation in electric two-wheelers, Ajinkya Firodia, Vice Chairman and Managing Director of Kinetic Watts & Volts Ltd., said 2025 was a defining year for India’s electric scooter ecosystem.
“The industry decisively consolidated around leaders who stayed true to core scooter values such as strength, reliability, service and quality, while intelligently blending modern electronics and connected features,” Firodia said, noting that EV penetration in scooters crossed an all-time high of 16 per cent during the year.
He added that despite challenges such as rare-earth magnet shortages, tapering subsidies and rising input costs, domestic EV manufacturers continued to innovate and strengthen their market position. The entry of global players such as Tesla and VinFast further reinforced India’s credibility as a serious long-term EV destination, he said.
Firodia also pointed to policy support, including the reduction of GST from 28 per cent to 18 per cent, as a positive catalyst for the broader automobile market, which continued to grow despite global conflicts, tariff uncertainties and economic volatility.
Reflecting on the industry’s legacy, he termed the passing of Ratan Tata as a “turning point” for Indian automotive history, describing him as a leader who combined global ambition with innovation for the common Indian.
Design and engineering-led transformation is increasingly shaping vehicle development, according to Pratik Malkan, Chairman of Lusso Designs India.
“Personalisation has evolved from cosmetic differentiation to a core engineering principle, influencing vehicle architecture, material choices and feature integration,” Malkan said.
He added that Lusso Designs is supporting OEMs through AI-led design modelling, robotics-assisted production, advanced prototyping and lightweight composite engineering, enabling faster development cycles and premium positioning while aligning with sustainability goals.
With India’s high-net-worth and ultra-high-net-worth consumer base expanding, Malkan said demand for bespoke and premium mobility solutions is expected to remain strong, supported by global collaborations and a focused R&D roadmap.
On the tyre industry front, Harinder Singh, Managing Director and CEO of Yokohama India Pvt. Ltd., said that while consumers are seeking higher performance as road infrastructure improves, value and mileage remain key decision factors.
“On the OEM side, the shift has been even more pronounced. 17-inch and above tyres, now account for nearly a quarter of OEM supply, growing rapidly as SUVs and premium vehicles redefine the fitment landscape,” noted Singh
Despite ongoing currency volatility, Singh said the direction of the passenger vehicle market remains clear, led by SUV-led premiumisation.
As the industry enters 2026, industry leaders remain optimistic that continued innovation, strategic partnerships and customer-centric design will drive the next phase of growth for India’s automotive and mobility ecosystem.
The Indian medium and heavy commercial vehicle (M&HCV) industry appears to be entering the next upcycle, with industry volumes estimated to grow by around 8 per cent year-on-year in FY26 and 10 per cent in FY27, following a period of modest growth, according to a report by Nomura.
The report highlighted that improving industry fundamentals are likely to support demand over the medium term. It added that rising freight rates, lower GST-led affordability and a high average age of trucks–currently estimated at around 10 years, are expected to drive replacement demand, particularly during FY27-28.
It stated “M&HCV industry appears to be entering the next upcycle……. we believe these are still early stages of a CV upcycle”.
These factors together are improving fleet operator economics and supporting a recovery in volumes