Could India's Two-Wheeler Volumes Surge 9.5% in December 2025? FY26 Growth Expected at 6-9%
Synopsis
Discover how India's two-wheeler industry rebounded with a **9.5% surge** in December 2025, driven by key factors like affordability and consumer trends. What does this mean for FY26 growth? Get insights into the industry's future and the rise of electric two-wheelers.
Key Takeaways
9.5% year-on-year growth in December 2025 for two-wheelers.
Projected growth of 6-9% in FY26.
Strong performance in the electric two-wheeler segment.
Wholesale volumes surged 38% year-on-year .
Exports increased by 25.2% in December.
New Delhi, Jan 21 (NationPress) The two-wheeler sector in India experienced a remarkable increase of 9.5% year-on-year in December 2025, fueled by year-end demand, policy-driven affordability enhancements, and improving macroeconomic conditions, according to a report released on Wednesday.
As per the ratings agency ICRA, domestic two-wheeler volumes are anticipated to see a growth of 6-9% year-on-year in FY26, thanks to a resurgence in replacement demand, urban consumption, and stable rural income levels.
The agency highlighted that the recovery in urban discretionary spending combined with steady rural income, bolstered by a normal monsoon and sustained government spending, are significant driving factors.
Retail volumes notably increased by 9.5% during the month, largely due to year-end discounts and pre-purchases by consumers anticipating price hikes in January 2026.
Enhanced affordability, improved financing options, and higher showroom traffic contributed to this retail momentum, particularly in the entry-level motorcycle and scooter segments, as noted in the report.
Electric two-wheeler sales also saw a 32.8% year-on-year growth, with retail volumes hitting 97,744 units. However, the penetration of electric two-wheelers remained consistent at about 6-7% during the first nine months of FY2026, indicating a gradual shift in consumer preferences and the readiness of infrastructure.
Wholesale volumes surged by 38% year-on-year, reaching approximately 1.5 million units in December, driven by a low base and inventory replenishment ahead of the upcoming calendar year, according to the report.
On a cumulative basis, wholesale volumes grew by 4.8% during the first nine months of FY2026 (April-December), signifying a slow recovery throughout the fiscal year despite occasional demand weaknesses.
Exports played a crucial role in the growth observed in December, with monthly volumes rising by 25.2% year-on-year, while cumulative industry exports increased by 24.1% during the first nine months of FY2026. This strong performance was aided by a low base effect and improving demand in key international markets.
While December 2025 showed a sharp year-on-year recovery, the agency forecasts a broader policy-supported resurgence in FY26, with exports and a gradual normalization of domestic demand being pivotal.
Point of View
I believe that the rebound in India's two-wheeler market reflects broader economic recovery and shifting consumer patterns. It’s essential for industry stakeholders to monitor these trends closely to capitalize on growth opportunities, ensuring that the sector remains resilient and innovative.
NationPress
2 May 2026
Frequently Asked Questions
What was the growth rate of India's two-wheeler industry in December 2025?
India's two-wheeler industry saw a **growth rate of 9.5% year-on-year** in December 2025.
What factors contributed to the growth in the two-wheeler sector?
The growth was supported by **year-end demand**, **affordability improvements**, and favorable macroeconomic conditions.
What is the expected growth rate for FY26?
The domestic two-wheeler volumes are expected to grow by **6-9% year-on-year during FY26**.
How did electric two-wheeler sales perform?
Electric two-wheeler sales experienced a **32.8% year-on-year growth**, reaching **97,744 units**.
What role did exports play in the industry's growth?
Exports contributed significantly, with a **25.2% increase in monthly volumes year-on-year**.
