Indian auto dealers flag post-festive demand risks as vehicle stocks stay high

Indian auto dealers warned that elevated vehicle inventories and rising financing costs could weigh on demand after the festive season, even as they remained optimistic that strong retail activity in the coming weeks would help reduce stock levels.

Passenger vehicle inventory remained at about 43-45 days despite record wholesale dispatches, Federation of Automobile Dealers Associations (FADA) said on Friday.

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India’s overall auto retail sales fell 23.8% year-on-year in October, with passenger vehicle sales declining 14.2% and two-wheeler sales dropping 28.4%, according to FADA. Commercial vehicle retail sales, however, rose 2.3%.

FADA said rural, two-wheeler-led buying that drove sales in October last year is expected to reflect in this year’s November figures. It expects the November 2026-January 2027 quarter to remain cautiously optimistic, with a measured outlook.