The Indian automotive market experienced modest growth of 2.5% in FY2024-25, with wholesale volumes reaching 4.32 million units compared to 4.22 million in the previous financial year. This growth story, however, masks significant contrasts between segments and manufacturers, revealing a market in transition. The financial year has been characterized by considerable back-and-forth between OEMs and dealers, with many struggling to clear inventory backlogs.
Key Highlights:
- SUVs continued their dominant position with an impressive 11.6% growth
- Mahindra emerged as the standout performer, contributing 53% of the industry's total growth
- Traditional body styles (sedans and hatchbacks) saw double-digit declines
- The premium segment showed resilience despite the overall market slowdown
- Significant disparity between retail (VAHAN) and wholesale numbers indicates ongoing inventory challenges
The transformation of the Indian automotive landscape continues with SUVs adding a staggering 242,024 units, representing an 11.6% growth year-over-year. Meanwhile, MUVs contributed an additional 40,468 units with a decent 6.3% growth. The traditional body styles suffered significantly with hatchbacks losing a substantial 138,595 units (-12.6%) and sedans declining by 39,652 units (-10.4%). Despite the overall market growth of just 2.5% (104,245 units), the combined growth of SUVs and MUVs totaled 282,492 units, clearly demonstrating the dramatic shift in consumer preferences.
Mahindra: +19.9% (91,623 UNITS)
- Contributes 2.2% to overall market growth (which was 2.5%)
- Scorpio leads sales with 164,842 units
- Achieves the 550,000 milestone for trailing twelve months
- Oscillates between ranks 3 and 4 throughout the year
- Made it to rank 2 in February, giving fierce competition to Tata and Hyundai
- Single-handedly responsible for 53% of the entire market's volume growth
Toyota: +25.8% (63,379 UNITS)
- Contributed 1.5% to overall market growth
- Innova remains flagship with 107,204 units
- Strong performance in premium segments
- Second-largest contributor to market growth after Mahindra
- Success driven by model sharing strategy with Maruti Suzuki
MG Motors: +12.0% (6,648 UNITS)
- Windsor EV becomes significant with 19,424 units
- Successfully positioned in the growing EV segment
- The Hector, their flagship that once defined the brand, slumped 43% this fiscal, marking a sharp fall for the model that built the MG brand.
Kia: +3.9% (9,573 UNITS)
- Sonet leads sales with 99,805 units
- Maintains positive momentum in competitive segment
- Benefits from Hyundai Group platform sharing strategy
- SKODA: +0.8% (342 UNITS) l Kushaq leads with 17,358 units
- Recently launched Kylaq provides significant momentum in the last quarter
- March sees over 7,000 units with Kylaq contributing over 5,000 units
Laggards
Jeep: -27.1%
- Compass remains bestseller with just 2,604 units
- Struggles to maintain relevance in competitive SUV segment
Honda: -23.9% (-20,659 UNITS)
- Amaze remains bestseller with 32,703 units
- Leads the decline among major manufacturers
- Suffers from limited SUV portfolio in SUV-dominated market
Citroen: -22.6%
- C3 leads with mere 2,652 units
- Five models collectively sold just 6,516 units for the entire financial year
- Basalt and C3 Aircross struggle even in strong Mid-sized SUV segment
- RENAULT: -17.5%
- Triber leads with 19,905 units
- Decline in a segment that itself is under pressure
Tata Motors: -3.0% (-18,388 UNITS)
- Underperforms in growing segments
- Nexon declines 5% despite 11% segment growth
- Substantial declines in Altroz (-35,000 units), Tiago and Tigor (-27,000 units)
- Punch remains bestseller with 196,572 units
- Needs urgent portfolio refresh in competitive segments
Hyundai: -2.6% (-16,055 UNITS)
- Creta remains strong with 194,871 units despite the overall company decline
- Third-highest selling model overall
- Other than the Exter and the Creta, all nine of their remaining models faced a volume decline.
Maruti Suzuki: +0.1% (883 UNITS)
- Virtually flat with an insignificant increase of 883 units
- Only 5 of 17 models show positive growth (Ertiga, Fronx, Vitara Brezza, Grand Vitara, Dzire)
- WagonR recaptures top position with 198,451 units
- Remaining heavily dependent on aging small car portfolio
The below chart explains how the product portfolios of all the OEMs are spread across the various sub-segments. The ones marked in RED showing declining growth rates and the ones in GREEN show increasing growth rates MARKET CONCENTRATION The top 6 manufacturers (Maruti, Hyundai, Tata, Toyota, Kia, and Mahindra) control 92.4% of the market, leaving 7 other manufacturers competing for the remaining 7.6%. This concentration reflects the challenging environment for smaller players who lack scale advantages and struggle with brand recognition in the Indian market.
Market Concentration
The top 6 manufacturers (Maruti, Hyundai, Tata, Toyota, Kia, and Mahindra) control 92.4% of the market, leaving 7 other manufacturers competing for the remaining 7.6%. This concentration reflects the challenging environment for smaller players who lack scale advantages and struggle with brand recognition in the Indian market.
High-growth Segments
Mid-sized Suvs: +19%
- Leaders: Toyota Hyryder (+23.5%), Hyundai Creta (+19.7%)
- Price range: Rs 10-20 lakh
- The hottest battleground in Indian automotive
- Represents the largest volume premium segment
- Success factors: Elevated driving position, perceived safety, road presence
- Key competitors: Hyundai Creta, Kia Seltos, Maruti Grand Vitara, Toyota Hyryder, Honda Elevate, VW Taigun, Skoda Kushaq, MG Astor
- Combined Grand Vitara/Hyryder platform reaching 184,334 units, approaching Creta's volumes
- Segment witnessing continuous feature upgrades and technology advancements
- Even premium pricing not deterring consumer interest
SUV - 4M: +11%
- Leader: Mahindra XUV300/3XO (+81.8%)
- Price range: Rs 7-13 lakh
- Second battleground segment with massive volumes
- Sub-4m tax advantage creating intense competition
- Notable models seeing significant upgrades (XUV 3XO replacing XUV300)
- Nexon struggling (-5%) despite segment growth
- Tata's first major failure to capitalize on growing segment
- Brezza, Sonet, Venue maintain strong positions
- Segment increasingly features sunroofs, ADAS features previously reserved for higher segments
Mid-Sized MUVs: +19%
- Rumion showed remarkable growth (+266.3%)
- Ertiga remains strong (+27.5%)
- Combined Ertiga/Rumion/XL6 platform achieving 249,961 units. That is a quarter million.
- Segment benefiting from practical three-row configuration
- Cost-effective people movers seeing strong demand
- Success of Toyota-badged Rumion demonstrating brand premium effect
Utility Suvs: +16%
- Dominated by Scorpio variants (+16.5%)
- Mahindra's flagship continues to drive growth
- Combined Scorpio/Scorpio-N creating formidable volumes
- Rugged styling and off-road capability resonating with buyers
- Represents the authentic SUV experience in the market
- EV6 showing strong growth (+22.7%) in premium utility space
SUV - Mini: +10%
- Led by Tata Punch (+15.6%)
- Entry SUV segment attracting first-time buyers
- Taking share from traditional hatchbacks
- Offering SUV styling at accessible price points
- Demonstrating that SUV trend extends across all price bands
Decling Segments
Mid-Sized Sedans: -26%
- Only Virtus showing minimal growth (+1.6%)
- Traditional three-box design losing appeal
- Premium sedan buyers migrating to SUVs
- Suffering from perceived lower ground clearance concerns
Micro Suvs: -22%
- S-Presso declining significantly (-22.9%)
- Small footprint with tall stance not resonating with consumers
- Price proximity to more substantial small SUVs creating cannibalization
4-Meter Hatchbacks: -21%
- Even segment leader Glanza down (-6.5%)
- Premium hatchbacks suffering from SUV migration
- European-style hatchbacks finding limited traction
- Once aspirational segment being hollowed out
Large Premium Sedans: -24%
- Toyota Camry down (-21%)
- Executive sedan segment collapsing l Premium buyers shifting to luxury SUVs
- Premium buyers shifting to luxury SUVs
Top Selling Models
Maruti Wagonr: 198,451 Units
- Recaptured #1 position from Tata Punch by slim margin (less than 2,000 units)
- First time in 40 years Maruti has temporarily lost the top spot (to Punch)
- Maintains leadership despite being in declining hatchback segment
- Demonstrates enduring appeal of practical, affordable transportation
Tata Punch: 196,572 Units
- Strong performer in growing SUV segment
- Nearly maintained top position despite being relatively new model
- Successful crossover from hatchback to SUV styling
- Setting new benchmark for entry-level SUVs
Hyundai Creta: 194,871 Units
- Remarkable achievement at premium price point
- Only 3,500 units behind WagonR despite 100% higher median price
- Demonstrates willingness of Indian consumers to pay premium for desired features
- Middle-class shifting preferences toward more premium offerings
- Continues to dominate mid-sized SUV segment despite increasing competition
Maruti Swift/dzire: Combined Strong Volumes Despite Segment Decline
- Maintaining relevance through periodic refreshes
- Traditional sedan/hatch combination showing resilience
Mahindra Scorpio: 164,842 Units
- Flagship model driving Mahindra's remarkable growth
- Combining traditional Scorpio and new Scorpio-N to dominate utility segment
- Demonstrating demand for authentic SUV experience
Platform Sharing Success Stories
The financial year 2024-25 has highlighted the critical importance of platform sharing strategies to achieve manufacturing efficiencies and maximize returns on development investments:
- Baleno/Glanza: Combined 216,000 units
- Toyota-badged Glanza maintaining significant volumes despite being virtually identical to Baleno
- Customers willing to pay Toyota premium for same underlying product
- Successful badge engineering demonstrating strength of Toyota brand
- Ertiga/Rumion/XL6: Combined 249,961 units
- Quarter million units on single platform representing extraordinary efficiency
- Three distinct market positionings from single engineering investment
- Rumion's rapid growth (+266.3%) showing untapped potential for Toyota-badged products
- Demonstrates how platform sharing can create substantial volumes in people-mover segment
- Grand Vitara/Hyryder: Combined 184,334 units
- Only 10,000 units behind segment-leading Creta
- Maruti-Toyota partnership creating formidable competition
- Platform sharing allowing both brands to compete effectively in premium segment
- Combined volumes creating economies of scale impossible to achieve individually
- Other Notable Platform Shares:
- Volkswagen Group's MQB-A0-IN platform underpinning Taigun, Kushaq, Virtus, and Slavia
- Hyundai-Kia shared platforms allowing rapid new model introduction
These platform sharing strategies represent critical competitive advantage in a market with razor-thin margins, allowing manufacturers to:
- Amortize development costs across higher volumes
- Share manufacturing facilities and suppliers
- Reduce parts inventory complexity
- Improve negotiating position with suppliers
- Create distinct brand positionings from common engineering
The waterfall charts reveal several critical insights about the Indian automotive market that might not be immediately apparent from tables alone:
Body Type Insights
- Dramatic divergence between body styles, with SUVs and MUVs rising at double-digit rates while sedans and hatchbacks decline at similar rates
- When viewing the absolute volume changes, the scale of SUV dominance becomes even more apparent - the 242,024 unit increase in SUVs represents 2.3x the entire market growth
- The numbers clearly demonstrate how the hatchback decline (-138,595 units) has essentially transferred to the SUV segment, representing a fundamental shift in consumer preferences rather than overall market expansion
OEM Insights
- OEM growth percentage reveals extreme polarization, with Toyota and Mahindra showing growth rates 10x higher than the market average
- The absolute volume waterfall dramatically illustrates how just two manufacturers (Mahindra and Toyota) have contributed 155,002 additional units in a market that grew by only 104,245 units
- The stark declines across multiple established manufacturers (Honda, Tata, Hyundai) indicate structural market shifts rather than cyclical changes
- The highly divergent performance suggests that product portfolio alignment with current consumer preferences is more important than brand legacy or historical market position
Strategic Insights
SUV Dominance: The shift toward SUVs continues unabated with growth across mini (+10%), sub-4m (+11%), mid-sized (+19%) and utility (+16%) segments. This represents a fundamental realignment of the Indian automotive market rather than a passing trend.
Premium Segment Resilience: Higher-priced models showing stronger growth than budget segments, indicating economic resilience among premium buyers. The Creta's remarkable performance at significant price premium over traditional volume leaders demonstrates a maturing market where features and status increasingly outweigh pure price sensitivity.
Platform Sharing Advantages: Manufacturers leveraging shared platforms (Maruti-Toyota, Hyundai-Kia) showing strong combined numbers and improved profitability. The quarter-million unit volume achieved by the Ertiga/Rumion/XL6 platform and the near-Cretamatching- leadership of combined Grand Vitara/ Hyryder volumes demonstrate how critical these strategies have become.
Manufacturer Polarization: Growth concentrated among few manufacturers (primarily Mahindra and Toyota), while others struggle to maintain position. The fact that Mahindra alone contributed 53% of the entire market's growth indicates a winner-takes-all dynamic developing in key segments.
Electric Vehicle Emergence: Models like MG Windsor gaining traction, signaling the beginning of EV mainstream adoption. With 19,424 units, the Windsor has demonstrated that appropriately positioned EVs can achieve meaningful volumes in the Indian market.
Segment Collapse: Certain traditional segments are experiencing rapid contraction, with mid-sized sedans (-26%), micro SUVs (-22%), and traditional hatchbacks all seeing double-digit declines. This represents permanent structural change rather than cyclical downturn.
Market Concentration: The 92.4% market share held by just six manufacturers indicates extremely difficult conditions for smaller players, with limited opportunity for new entrants without distinctive positioning or technology advantage.
Outlook And Recommendations
Portfolio Rebalancing: Manufacturers heavily dependent on hatchbacks and sedans need urgent portfolio diversification toward SUVs and MUVs. Honda and Hyundai in particular must accelerate SUV development to remain competitive.
Premium Segment Opportunity: Growing acceptance of higher-priced models suggests opportunity for feature-rich, premium offerings. The success of vehicles priced above ₹15 lakh indicates headroom for further premiumization with appropriate feature sets.
Platform Optimization: Further development of shared platforms and manufacturing resources to improve margins in a competitive market. The Maruti- Toyota alliance has demonstrated the power of this approach, with Toyota achieving 25.8% growth largely through badge-engineered Maruti products.
Mid-sized SUV Focus: With 19% growth in a maturing market, the mid-sized SUV segment represents the most attractive opportunity. Manufacturers should prioritize new model development and feature enhancements in this segment, which appears to have substantial remaining growth potential.
Tata Recovery Strategy: Tata Motors needs comprehensive portfolio refresh with:
- Revitalization of Altroz to compete effectively in the 300K+ hatchback segment
- A hard relook at their Nexon strategy to see where it is lacking compared to segment leaders
- Aligning its powertrain strategy with the segments it's targeting. Despite the Curvv's Coupe SUV design, it’s up against mid-size heavyweights like the Creta and Grand Vitara and lacks the engine performance and automatic tech to compete. This mismatch is proving costly, and the market is signaling loud and clear: the product strategy isn't landing
- Leveraging EV leadership into mainstream segments
EV Strategy Acceleration: Growing acceptance of models like MG Windsor suggests an opportunity for mainstream manufacturers to accelerate EV offerings targeted at urban, tech-savvy consumers willing to be early adopters.