The monthly data reveals a striking pattern of extreme volatility in the two-wheeler segment, with growth figures ranging from 36.34% in October to -17.64% in December.
07 Apr 2025 | 1552 Views | By Shruti Shiraguppi
In a mixed indicator for India's automotive sector, two-wheeler retail sales registered a moderate 1.77% year-over-year decline in March 2025, with registrations totaling 15,08,232 units compared to 15,35,398 units in March 2024, according to data released by the Federation of Automobile Dealers Associations (FADA).
Despite the March contraction, the ...
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In a mixed indicator for India's automotive sector, two-wheeler retail sales registered a moderate 1.77% year-over-year decline in March 2025, with registrations totaling 15,08,232 units compared to 15,35,398 units in March 2024, according to data released by the Federation of Automobile Dealers Associations (FADA).
Despite the March contraction, the overall fiscal year 2025 ended on a strong note for the two-wheeler segment, which posted a robust 7.71% annual growth compared to FY2024. This yearly performance significantly outpaced other automotive categories, highlighting the segment's resilience in the face of various market challenges.
The monthly data reveals a striking pattern of extreme volatility in the two-wheeler segment, with growth figures ranging from a remarkable high of 36.34% in October 2024 to a concerning low of -17.64% in December 2024. Despite ending the fiscal year on a slightly negative note in March, the overall trend has been significantly positive.
"The 2W segment, despite an 8.57% FY YTD growth, retail sales dipped by 1.77% YoY in March," noted Mr. C.S. Vigneshwar, FADA President. "Urban areas experienced a sharper decline compared to rural markets, which have shown better resilience due to improved agricultural sentiment and seasonal marriage demand."
Rural Market Outperforms Urban Counterparts
A striking trend throughout FY2025 has been the stronger performance of two-wheelers in rural areas compared to urban centers. Rural 2W sales grew by 8.39% for the fiscal year, comfortably outpacing the 6.77% growth seen in urban areas. This rural dominance suggests improving economic conditions and purchasing power in India's heartland.
"Rural market resilience has been a key driver for the segment's overall growth," Vigneshwar explained. "Better agricultural output, government support programs, and the improving road infrastructure in rural India have all contributed to this trend."
Brand Performance Dynamics
Hero MotoCorp maintained its leadership position with a 28.90% market share in March 2025, though this represented a slight decline from 29.45% in March 2024. Honda Motorcycle and Scooter India held steady at around 23.6%, while TVS Motor Company strengthened its position, growing from 16.48% to 18.24% market share year-over-year.
The premium segment also showed significant movement, with Royal Enfield increasing its market share to 5.00% from 4.28% in the previous year, reflecting the growing consumer preference for higher-displacement motorcycles.
Electric Vehicle Impact
The two-wheeler EV segment continues to make significant inroads, with electric vehicles accounting for 8.6% of total 2W sales in March 2025. While this represents a slight decline from the 9.1% seen in March 2024, the yearly EV penetration increased to 6.1% in FY2025 from 5.4% in FY2024.
"The EV transition is progressing steadily in the 2W segment," commented Vigneshwar. "However, we're seeing a more measured pace of adoption as consumers weigh factors like charging infrastructure, battery performance, and value proposition."
Challenges and Outlook
Looking ahead to FY2026, FADA anticipates mid to high single-digit growth for the two-wheeler segment. However, several challenges loom on the horizon. The implementation of OBD-2B emission norms is expected to increase vehicle prices, potentially dampening demand, especially in the entry-level segment. Additionally, financing challenges persist, with dealers calling for rate cuts from the RBI to stimulate consumer borrowing.
"While we remain cautiously optimistic for the new fiscal year, we're mindful of the multiple headwinds facing the sector," Vigneshwar cautioned. "Extreme weather conditions, global trade tensions, and potential stock market volatility could all impact consumer sentiment and disposable income."
The two-wheeler market's performance in March, despite showing a slight decline, reflects a segment that has demonstrated remarkable resilience through FY2025. With rural markets continuing to show strength and the gradual shift toward premiumization and electrification, the outlook remains guardedly positive despite the month-to-month volatility that has characterized the past year.