The Resurgence of the Automotive Sector Post-GST Reforms
The Resurgence of the Automotive Sector Post-GST Reforms

The Resurgence of the Automotive Sector Post-GST Reforms

This article is part of a thought leadership series by the Ipsos Auto sector expert group. This team of experts in the automotive sector join forces to share their unique perspectives and insights about the latest trends, innovations, and happenings in the auto industry. The intent is to keep our clients informed and up-to-date through the lens of research.

A significant GST rate cut, combined with strong festive season demand, led to record sales for India's entry-level car and two-wheeler market in late 2025. This article explores this phenomenon, also giving a perspective on whether this is a temporary, policy-driven sales spike or the beginning of a sustainable, long-term recovery for the automotive sector.

In the short term, it functioned as a powerful demand catalyst, giving a short-term relief to some struggling segments. In the long term, with continued support and systematized investment plans from the industry, it has the potential to structurally expand the market, boost domestic manufacturing, and reinforce the automotive sector's crucial role as a primary engine of India's economic growth.

Also published in autocar - https://www.autocarpro.in/opinion-blogs/gst-cuts-have-given-a-boost-to-sales-but-is-it-short-lived-festive-happiness-or-a-sustainable-trend-that-is-here-to-stay-129806

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