Banking on Festive Recovery: Hyundai’s Tarun Garg on Navigating Q1 SUV Sales Slump

Hyundai Motor India is facing headwinds in its core SUV business, as the company’s total volume dipped 6% during Q1 FY26 to 1,80,399 units. The company’s domestic dispatches fell 11.5% to 1.32 lakh units and lost the number two position in the India passenger vehicle market for the first time. SUVs now account for 68.4% of Hyundai’s total passenger vehicle sales and in the first three months of the quarter itself, the South Korean company saw 10% fall in its SUV dispatches. 

“This quarter was marked by geo-political situations: it started with the Indo-Pak war that lasted 17 days, the Iran-Israel conflict, and tariff confusion. There were a lot of factors pulling down demand,” said Tarun Garg, Whole-Time Director and COO at Hyundai Motor India. “June was the lowest Total Industry Volume (TIV) in the last 30 months barring December. Things were tough.”

While industry-wide challenges weighed on volumes, Hyundai’s SUV portfolio—led by the Creta, Venue, and Exter—faced intensifying competition from rivals like Tata and Mahindra, both of whom are expanding aggressively with new launches and EVs.

Despite the sales pressure, Hyundai managed to defend margins. “Thanks to our premiumisation strategy and a good export mix, we were able to deliver a very reasonable EBITDA margin of 13.3% in Q1,” Garg added. He also pointed to sequential gains in market share based on VAHAN data: from 12.4% in March to 12.9% in June, with expectations of crossing 13% in July.

Looking ahead, Hyundai is betting on a recovery as the festive season kicks off in August. “We believe the combination of festive demand, the recent RBI rate cut, and income tax rebates will start kicking in and support the industry,” Garg said.