SUV and MPV sales surpass passenger cars for first time in FY22, reveals SIAM

  • The Indian market has been witnessing a massive trajectory shift in the last few years, inclined towards utility vehicles.
SUVs sales have increased in India significantly in the last four years, reveals SIAM data.
SUVs sales have increased in India significantly in the last four years, reveals SIAM data.

Indian consumers' fascination with small cars seems to have subsided with the emergence of utility vehicles including SUVs and MPVs. Data revealed by SIAM shows how the utility vehicle wholesales have surpassed the sales of hatchbacks and sedans. The utility vehicles combining SUVs and MPVs have grabbed 48.5 per cent market share in the Indian passenger vehicle space in FY2021-22.

Also Read : Small cars, two-wheelers facing ‘affordability issues’, SIAM data shows pain

The utility vehicles registered 14,89,178 units in the last fiscal, while passenger cars recorded 14,67,056 units in FY22. While the edge of the utility vehicles over passenger cars is marginal but the shift of trajectory is significant. The data shows how Indian consumers are shifting their focus on SUVs, crossovers and MPVs from small cars and sedans. This echoes the forecast of a Crisil report that predicts that utility vehicles will outperform other segments in the Indian auto market between FY21 and FY26 and will grow at a CAGR of 14-18 per cent.

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Utility vehicle sales in FY19 were 9,41,474 units, while passenger cars recorded 22,18,489 units in the same fiscal. Since then the gap between the utility vehicles and passenger cars has narrowed and eventually, UVs have surpassed the passenger cars. On the other hand sales of passenger cars comprising hatchbacks and sedans have dropped continuously over the last four financial years.

Several factors have influenced this trajectory shift. While the Indian market has witnessed the launch of more than two dozen SUVs and MPVs in the last two years, the passenger car segment has seen only a few near cars arrive in the space. The narrowing price gap between small cars and SUVs too has influenced the consumers' buying decision in favour of the utility vehicles. Other influencing factors for the SUV's rise include better safety, a more comfortable riding experience, a wide range of technology etc.

Since the beginning of the pandemic, rural and semi-urban markets have been impacted heavily. This has resulted in reduced disposable income of buyers, leading them to halt their purchase of cars. The majority of the buyers in rural and semi-urban markets focus on small cars while buying their first vehicle. With the consumer sentiment hurt due to the weak economy, sales of small cars have been impacted. On the other hand, sales of utility vehicles in the urban market have continued.

First Published Date: 14 Apr 2022, 11:48 AM IST

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