India's automotive sector closed out the fiscal year on a broadly positive note, according to a sector research report published by BNP Paribas on 2 April 2026. The report identifies diverging trends across vehicle segments, with passenger vehicles (PVs) and two-wheelers (2Ws) holding firm while commercial vehicles (CVs) begin to show cracks.
Festive Tailwinds Lift March Volumes
BNP Paribas attributes much of the month's wholesale strength to the Chaitra Navratri festival and a higher number of auspicious wedding days compared to March 2025. The report also notes that anticipated price hikes from April 2026, particularly in PVs and CVs, may have prompted some pre-buying activity.
According to BNP Paribas, industry-wide year-on-year domestic wholesale growth for March 2026 came in at approximately +14% for two-wheelers, +16% for passenger vehicles, +13% for commercial vehicles, and a standout +27% for tractors.
Passenger Vehicles New Launches Drive Outperformance
BNP Paribas data shows Maruti Suzuki posted overall volume growth of around 17% year-on-year in March 2026, supported by a notable 43% surge in export volumes despite ongoing Middle East conflict weighing on some peers. Mahindra & Mahindra reported automotive dispatch growth of approximately 21% year-on-year, with UV volumes expanding 25% and tractor shipments rising 29%, driven by domestic festive demand.
Tata Motors PV recorded a particularly sharp 29% year-on-year rise in total PV wholesale, with electric vehicle sales growing at 77% year-on-year, pushing EV penetration up to approximately 14% of total sales — a gain of around 400 basis points year-on-year, per BNP Paribas estimates.
Two-Wheelers Broad-Based Strength
The two-wheeler segment delivered robust numbers across the board. BNP Paribas data shows TVS Motor expanded total sales volume by approximately 25% year-on-year, outpacing peers across motorcycles, scooters, and three-wheelers. Hero MotoCorp reported more modest growth of around 9% year-on-year in shipments, though scooter volumes surged 53% year-on-year on a low base. Royal Enfield recorded domestic wholesale growth of 14% year-on-year.
March 2026 month-on-month retail registrations for both PVs and 2Ws tracked above historical medians, with BNP Paribas noting PV industry retail grew 12% and 2W retail grew 17% on a month-on-month basis.
Commercial Vehicles Cracks Emerging
While headline CV wholesale numbers remain positive, BNP Paribas flags underlying softness in the medium and heavy commercial vehicle (MHCV) segment. Ashok Leyland's domestic MHCV volume was essentially flat year-on-year in March 2026, with bus shipments declining sharply by approximately 34% year-on-year, partially offset by a 10% rise in truck volumes. Total domestic wholesale for Ashok Leyland rose only around 6% year-on-year — lagging the broader market.
The BNP Paribas report identifies commercial LPG availability as a key variable to monitor for CV industry demand and fleet utilisation going forward.
Cost Pressures Build
On the macro side, BNP Paribas warns that its proprietary commodity cost index rose sharply by approximately 5% month-on-month for both PVs and 2Ws in March 2026. The firm attributes this to geopolitical tensions disrupting sentiment and supply chains for key inputs such as aluminium. While diesel and freight demand increased month-on-month, the cost environment is tightening heading into the new fiscal year.
JLR Weighs on Tata Motors
Jaguar Land Rover's wholesale volumes (excluding China JLR) for the fourth quarter of FY26 declined approximately 14% year-on-year to 95,300 units, falling short of BNP Paribas' estimate of 104,000 units. Volume declines were recorded across most key markets including the UK, North America, and China, partially offset by growth in Europe. Sequentially, however, wholesale rebounded sharply — rising around 61% from the third quarter — as production normalised following a prior cybersecurity incident.
Market Share Shifts
BNP Paribas identifies Mahindra & Mahindra and Toyota as year-on-year retail market share gainers in the PV segment, while Hyundai Motor India was flagged as losing ground. In the two-wheeler space (excluding Honda), Hero MotoCorp and Bajaj Auto gained share, while Royal Enfield saw some erosion, according to BNP Paribas calculations.