India’s passenger vehicle market enters the 2026 festive season with cautious but measurable purchase intent, as a Grant Thornton Bharat survey of more than 1,300 consumers and 500 dealers reveals that only one in four respondents plan to buy a vehicle this season, while a third remain undecided.
The survey, titled Festive Drive: What Consumers Want in Their Next Ride, found that 24.9 per cent of respondents identified as likely or definite festive-season buyers, with a further 32.9 per cent still exploring options. The Society of Indian Automobile Manufacturers reported approximately 2.61 million passenger vehicle sales in the first half of FY 2026-27, up 28 per cent year on year, suggesting underlying market momentum remains intact.
Safety emerged as the single most important purchase factor, cited by 57 per cent of respondents, followed by fuel efficiency at 51.6 per cent and price at 47.2 per cent. The findings indicate consumers are evaluating affordability through total ownership costs rather than sticker price alone.
SUVs retained their dominance as the preferred vehicle format at 58.3 per cent, though this marks a decline from 64 per cent in 2025. Hatchbacks gained ground, rising from 10 per cent to 16.6 per cent, pointing to renewed interest in more affordable, efficient formats.
On powertrain preference, hybrids led at 37 per cent, broadly stable against 38 per cent in 2025, while electric vehicle consideration edged up from 21 per cent to 22.8 per cent. Diesel remained the least preferred option at 8.8 per cent. Seven in ten respondents rated sustainability as extremely or somewhat important, though consumers overwhelmingly linked it to practical considerations such as fuel efficiency rather than environmental messaging alone.
Consumer awareness of regulatory changes presents a challenge for the industry. Only 32.6 per cent of respondents were aware of the upcoming Corporate Average Fuel Economy Phase III norms, effective April 2027. Additionally, 40.9 per cent expressed concerns over engine performance and maintenance related to E20-compatible vehicles.
Financing patterns also shifted, with blended loan-and-self-funding declining from 66 per cent to 53.9 per cent, while full self-funding rose from 14 per cent to 22.5 per cent, suggesting buyers are reassessing how much of their purchase they wish to finance amid higher interest rates.
Published on November 5, 2026
