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Festive Cheer, Reform Reset: Auto Sales See Sharp Rebound

A combination of tax cuts and proactive moves by the industry leads to one of the best festive season performances by the auto industry.

By Darshan Nakhwa

18 Nov 2025

5260 Views

Festive Cheer, Reform Reset: Auto Sales See Sharp Rebound

In a year when consumer sentiment had begun to soften and buyers were holding back, India’s automobile industry found an unexpected accelerator. The rollout of Goods and Services Tax 2.0 in September, timed almost perfectly with the festive season, reshaped the economics of mobility. With lower tax rates on small cars and commuter two-wheelers, and a simplified structure for larger vehicles, affordability improved just as festive optimism peaked.

The effect was immediate. Vehicle retail sales in October jumped 40.5% year-on-year, the highest monthly growth in India’s automotive history. Showrooms that had seen cautious footfalls through much of the year ...

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