High base effect dampens India auto sales as EV momentum accelerates

Vehicle retail sales across India contracted last month as a combination of statistical headwinds and festival timing impacted consumer purchases. Total retail sales fell to approximately 3.17 million units in October, primarily due to comparisons against a strong base from the previous year, according to data from the Federation of Automobile Dealers Associations (FADA). The timing of Diwali celebrations, which shifted to November this year from October, further suppressed sales activity during the month.

Electric vehicle sales, however, continued their upward trajectory, climbing 45 per cent year-on-year to reach a record 355,000 units. The surge reflects accelerating adoption of battery-powered vehicles across India's automotive market, driven by expanding model availability, charging infrastructure improvements, and government incentives aimed at promoting electrification.

The divergent trends underscore a broader shift in India's vehicle market, where traditional fuel-powered vehicles face headwinds while the EV segment gains momentum. Industry analysts attribute the strength in electric vehicle sales to growing environmental awareness among consumers and increasing corporate purchases of electric fleets.

With Diwali festivities expected to drive pent-up demand in November, industry participants anticipate a rebound in overall sales in the coming weeks. The seasonal uplift, combined with sustained EV growth, may help the automotive sector offset recent headwinds as the fiscal year enters its final quarter.