February Auto Sales Surge Across Vehicles Amid Policy And Investment Shifts

India’s automotive industry wrapped up February 2026 with robust growth across passenger vehicles, SUVs, two-wheelers, tractors, and commercial vehicles. While demand momentum remained strong, the week highlighted the impact of production limits, subsidy disputes, and strategic global partnerships shaping the country’s auto landscape.

Passenger Vehicle Growth Driven by SUVs and Compact Cars

SUVs remained the backbone of passenger vehicle growth. Tata Motors’ Nexon topped February sales charts for the second consecutive month, selling 19,430 units. Maruti Suzuki reported domestic PV wholesales of 161,000 units, operating at full manufacturing capacity, with growth constrained by production limits rather than demand. Hyundai India saw record February sales, up 12.6% year-on-year, while Mahindra’s SUV segment rose 19%, reaching 60,018 units domestically.

Multi-purpose vehicles are gaining market share, with MPV sales estimated at 17% of total utility vehicle sales in the first ten months of FY2026, up from 11% in FY2025. Maharashtra emerged as the leading passenger vehicle market, contributing 12.4% of national sales in Q3 FY2025-26, ahead of Uttar Pradesh and Gujarat.

Two-Wheelers, Tractors, and Commercial Vehicles Post Strong Gains

Hero MotoCorp reported 558,216 units dispatched, marking 44% growth. TVS Motor Company achieved 31% year-on-year growth, while Royal Enfield sold 1,00,905 motorcycles in February. Greaves E-Mobility two-wheeler sales surpassed 270,000 units, with Ampere outselling Ola during the month.

Tata Motors’ commercial vehicle segment grew 32% year-on-year, delivering 42,940 units in February. Mahindra tractor sales surged 35% domestically to 32,153 units, reflecting rising rural demand and mechanization. Exports contributed modestly but showed healthy growth, with Mahindra exporting 1,980 tractors, up 20% from February 2025.

EV Policies and Government Initiatives Under Scrutiny

Bajaj Auto Managing Director Rajiv Bajaj expressed concerns over Maharashtra’s EV policy, highlighting delayed subsidies and warning it could become a rare policy failure in his 36-year career. He also questioned the efficacy of subsidies, stating they may slow innovation and cushion inefficiency.

Former NITI Aayog CEO Amitabh Kant urged India to commit fully to electric vehicles instead of hybrids, framing EV adoption as a strategic economic priority. The government directed nationwide sales of E20 petrol with RON 95 from April 1 to promote cleaner fuels. The Centre for Digital Economy Policy also flagged potential eligibility bias in the electric two-wheeler PLI scheme, emphasizing the need to prioritize innovation over financial scale.

Strategic Investments and Global Partnerships Shape Industry Future

KTM AG secured a €550 million refinancing loan from an international banking consortium to manage its debt obligations with Bajaj Auto. Toyota Kirloskar Motor announced plans for a skill park in Maharashtra, extending its human resource development model pioneered in Japan. Switch Mobility aims to deliver 1,500 electric buses this fiscal year and maintain an order book of 2,500 units for the next fiscal, targeting $1 billion revenue within five years.

ZF Group plans to double India revenue by 2030, positioning the country as the fastest-growing market in its global portfolio. Schaeffler India expects exports to moderate to 5–10% in 2026 while stepping up capital expenditure to ₹500 crore. JSW Motors launched a dealer recruitment campaign for its standalone automotive venture, signaling entry into the PV segment independent of its MG Motor partnership. BKT, the off-road tyre leader, entered India’s on-highway market for two-wheelers and commercial vehicles, and Greaves Cotton allocated ₹500–700 crore to its “Greaves Next” growth strategy.

Manufacturing Expansion and Industry Outlook

Maruti Suzuki’s e-Vitara production remains capped at 2,000–2,500 units per month until July 2026, balancing domestic demand and export commitments. Tata Passenger Electric Mobility expects first-time buyers to drive EV adoption, with Punch.ev volumes forecasted to grow 30–50%.

Uttar Pradesh Chief Minister Yogi Adityanath met Aakash Minda in Tokyo to discuss manufacturing collaboration after a ₹522 crore land allotment for Minda Corporation’s automotive components facility. Pune-based Sedemac Mechatronics plans to enter the commercial vehicle segment with aftertreatment control modules for BS-VI engines. IAC India targets a 15–20% CAGR over the next five years, expanding into commercial vehicles, aftermarket segments, and new OEM partnerships.

Corporate Average Fuel Efficiency (CAFE-3) norms were sent to the PMO for approval, further shaping fuel efficiency regulations. Indonesia postponed plans to import 105,000 vehicles from India, citing domestic industry concerns.

Market Leaders and Key Highlights

• Tata Motors PV sales grew 35% to 63,331 units, maintaining the second spot in overall market rankings.
• Renault India reported 31% growth in February wholesales, reaching 3,495 units.
• JSW MG Motor India achieved 24% year-on-year growth.
• Mahindra launched the XEV 9e Cineluxe edition at ₹29.35 lakh, with bookings opening March 2.
• Hero MotoCorp’s 100cc–125cc motorcycle and scooter segments drove the 44% dispatch growth.
• Maruti Suzuki remains at full manufacturing capacity, with exports exceeding FY26 targets of 4 lakh units.

Conclusion

February 2026 highlighted India’s auto industry as a resilient and rapidly evolving market. Strong demand across passenger vehicles, SUVs, two-wheelers, tractors, and commercial vehicles coexists with production constraints, EV policy debates, and strategic global investments. Manufacturers are balancing domestic and international growth while preparing for the next wave of electric mobility, skill development initiatives, and regulatory changes. As India’s automotive sector continues its upward trajectory, strategic partnerships, policy clarity, and innovation will define the industry’s path forward.