Sri Lanka’s vehicle registrations rose sharply in September 2025, expanding by 27 percent to 48,708 units from the previous month, according to an analysis of vehicle registry data by Colombo-based brokerage J B Securities. The rise reflected a broad-based increase across all major vehicle categories.
Car registrations more than doubled to 4,268 in September from 2,329 in August, while SUVs and crossovers climbed to 5,813 from 3,800. Crossovers have now overtaken sedans and hatchbacks as the country’s most popular vehicle segment.
Combined, cars and crossovers totaled 10,081 units in September — up from 6,137 a month earlier — surpassing levels recorded before the economic crisis.
Motorcycle registrations also saw strong growth, reaching 32,626 units compared to 27,585 in August. Before the crisis, Sri Lanka typically recorded between 30,000 and 35,000 motorcycle registrations per month. Three-wheeler registrations rose to 3,015 from 2,497, although still below pre-crisis levels of around 10,000 per month.
The price of a new three-wheeler now averages around Rs. 2 million, significantly higher than the Rs. 500,000–600,000 range seen in 2015, due to heavy taxation and currency depreciation.
Sri Lanka reopened vehicle imports in February 2025, after a nearly five-year ban imposed in 2020 when money printing and tax cuts aimed at “potential output targeting” led to severe external imbalances.
Analysts note that vehicles remain a major source of government revenue, and the current surge in car and crossover imports may reflect pent-up demand following years of restrictions.
While vehicles are now being imported without foreign exchange shortages, the rupee has weakened in recent months. This is attributed to the Central Bank’s dollar purchases creating excess liquidity, without sufficient currency defense measures as imports picked up.
Despite high taxation — with only about a third of a car’s retail price impacting the forex market — the rise in registrations signals renewed consumer confidence and a gradual normalization of economic activity.
