NEW DELHI – The Indian auto industry demonstrated significant growth across key segments in Financial Year 2026, marking an all-time high in commercial vehicle sales and a substantial surge in electric vehicle adoption. According to Shailesh Chandra, President of the Society of Indian Automobile Manufacturers (SIAM), who spoke at the industry body’s annual convention, domestic commercial vehicle sales soared by 12.6% to 1.08 million units.
EV Adoption Accelerates Across Segments
Electric vehicle (EV) registrations in India reached 3.5 million units in FY26, a remarkable increase from 1.9 million units in FY25. This near-doubling highlights the rapid momentum in EV adoption across passenger vehicles, two-wheelers, and three-wheelers, where their share in new vehicle fleets continued to grow in double digits. Chandra attributed this acceleration to strong collaboration between the industry and government support, which has provided a crucial impetus for the transition to electric mobility.
Strong Performance in Commercial and Three-Wheeler Segments
Beyond commercial vehicles, the three-wheeler segment also recorded robust domestic demand, with sales climbing 12.8% to 840,000 units in FY26. Exports for commercial vehicles also saw positive movement, increasing by 3.4% to 95,000 units during the financial year.
Push for Alternative Fuels and Sustainability
The industry is actively pursuing initiatives in alternative fuels and energy security. As of April 1, 2025, the auto sector transitioned to manufacturing fully BS-VI compliant gasoline vehicles. Additionally, some manufacturers have introduced and commercially launched flex-fuel vehicles. SIAM’s efforts are also supporting the expansion of Compressed Natural Gas (CNG) infrastructure, while Liquefied Natural Gas (LNG) is being explored as a viable solution for long-haul heavy trucks. The industry is also partnering with the government on pilot deployments of green hydrogen-powered buses and trucks, signaling a broad commitment to decarbonization.
Localization and Vehicle Scrappage Initiatives
Chandra highlighted the industry’s commitment to localization, noting that collaborative efforts between SIAM members and the Automotive Component Manufacturers Association of India (ACMA) led to a reduction in imports by over ₹20,000 crore in FY25, representing a 16.6% decline compared to FY24. Furthermore, the industry is keen to partner with the government on the recently launched Parivahan scheme, which aims to scrap old commercial vehicles through authorized facilities, promoting a circular economy and modernizing the fleet.
Charting the Future: Automotive Vision Plan 2025-47
Looking ahead, SIAM has been identified as a key stakeholder in the Ministry of Heavy Industries’ Automotive Vision Plan, covering 2025 to 2047. This plan will establish a long-term roadmap for India's automotive sector, aligning it with the broader 'Viksit Bharat 2047' objective. Chandra expressed optimism about the industry's future trajectory, affirming its continued focus on sustainability, decarbonization, electrification, localization, recycling, and road safety.