The passenger vehicle (PV) segment, which was grappling with subdued demand, was expected to bounce back in August 2025 with the commencement of the festive season. However, uncertainty and speculation over the new Goods and Services Tax (GST) structure took a toll on the domestic volumes during the month as the companies recalibrated their wholesale dispatches to the dealerships.
According to industry data, the PV volumes fell 7.3% year-on-year (y-o-y) at nearly 3,30,000 units in August 2025 from around 3,56,000 units in the same month last year.
Among the top five carmakers, Maruti Suzuki India, Hyundai Motor India, Tata Motors and Mahindra & Mahindra witnessed a decline in their volumes during the month under consideration. Only Toyota Kirloskar Motor posted growth.
Domestic PV Wholesales - Top 5 Companies
| Company | August 2025 | August 2024 | Growth |
| Maruti | 1,31,278 units | 1,43,075 units | -8.24% |
| Hyundai | 44,001 units | 49,525 unit | -11.15% |
| Tata | 41,001 units | 44,142 units | -7.12% |
| Mahindra | 39,399 units | 43,277 units | -8.96% |
| Toyota | 29,302 units | 28,589 units | 2.49% |
Maruti's PV volumes declined 8.24% y-o-y at 1,31,278 units in August 2025. "The Indian government is bringing a major GST reform. We are expecting it to have a very positive impact on the automobile industry. In August 2025, we recalibrated our dealer dispatches," the company's Senior Executive Officer for Marketing and Sales, Partho Banerjee, said during a media briefing.
During the month, Maruti had eight models among the 10 largest-selling cars in India as the Ertiga (18,424 units) took the top slot. With Onam and Ganesh Chaturthi festivals falling in the last week of the month, the carmaker reached almost 1,50,000 total pending bookings.
Onam bookings increased by 16% in Kerala, while Ganesh Chaturthi bookings are also growing in Maharashtra, Banerjee said, adding that Maruti is hopeful of good retail once the GST reforms are announced.
Like several other companies, Maruti also took a conscious call to reduce the dispatches of bigger cars, which attract a higher compensation cess.
Replying to a question from Moneycontrol, Banerjee said: "We decided not to take chances with bigger cars. We were more comfortable in dispatching smaller cars as the compensation cess is just 1%, whereas bigger cars attract a higher compensation cess. The dealers were also happy to take smaller cars as they want to stock them for the festive season."
Although Hyundai took the second position in monthly PV volumes after a long gap, its wholesale dispatches dropped 11.15% y-o-y at 44,001 units in August 2025. "Our goal is to establish India as a strategic manufacturing base for emerging economies and to become Hyundai's largest export hub outside South Korea," the company's Whole-Time Director and Chief Operating Officer, Tarun Garg, said.
Tata's PV wholesales slipped 7.12% y-o-y at 41,001 units in August 2025, while those of Mahindra declined 8.96% y-o-y at 39,399 units during the month.
"August witnessed relatively robust demand in the SUV segment amidst anticipated GST rate changes," said Nalinikanth Gollagunta, CEO, Automotive Division, Mahindra.
"With the final GST announcement approaching, we consciously decided to bring down the wholesale billing to minimise the stock being carried by our dealers. We look forward to the GST rationalisation, which would be a demand driver through the festive season," he added.
Against the tide, Toyota's PV volumes increased 2.49% y-o-y at 29,302 units in August 2025.
With the GST rationalisation, the government is aiming to simplify the tax structure. The move includes eliminating the 12% and 28% slabs, retaining the 5% and 18% slabs and introducing a new 40% slab for luxury and sin goods. While the Group of Ministers (GoM) has already approved it, final details will be revealed after the GST Council meeting on September 3 and 4.
All internal combustion engine (ICE) vehicles, including PVs, two-wheelers, three-wheelers and commercial vehicles (EVs), attract 28% GST and a compensation cess ranging from nil to 22%, depending on size and category, at present. However, electric vehicles (EVs) and hydrogen fuel cell vehicles (FCEVs) benefit from lower GST rates of 5% and 12%, respectively, with no additional cess.
While the small ICE cars are expected to be shifted to the 18% slab, the larger PVs could be pushed into the newly proposed 40% bracket. The fate of the compensation cess, whether it will be retained or withdrawn, is not clear yet.
Regarding EVs, there have been speculations that models priced above Rs 20 lakh may face a higher 18% GST, potentially deterring buyers looking for an electric car with a high range.
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