Revving Forward: Two-Wheeler Market Awaits Boost

The domestic two-wheeler market is set for a 6-9% growth in the current fiscal year. Key drivers include replacement demand, urban consumption recovery, and potential GST cuts. Though retail volumes dipped due to urban demand issues and heavy rainfall, festive seasons and export growth promise recovery.

The domestic two-wheeler segment is projected to grow between 6 to 9 percent year-over-year this fiscal, according to rating firm Icra on Monday.

Growth factors include steady replacement demand, urban consumption recovery, rural income strength from a normal monsoon, and potential GST rate cuts for additional momentum, it noted.

In July 2025, wholesale volumes increased by 9 percent to 15 lakh units with OEMs preparing for the festive season. Yet, retail volumes shrank by 6.5 percent due to lukewarm urban demand and heavy rainfall's impact on rural sales, Icra mentioned. Retail demand is expected to surge with the upcoming festive period. Additionally, exports surged by 32 percent, though electric two-wheeler sales saw a 2 percent drop, maintaining a 6-7 percent segment penetration.