Hyundai Motor India has lost its long-held second position in India's domestic passenger vehicle rankings — and not to one competitor but two. Full-year sales declarations by Mahindra & Mahindra, Tata Motors and Hyundai confirm that the Korean automaker finished FY2025-26 at No. 4 behind Maruti Suzuki, Mahindra and Tata Motors, the first time in years that Hyundai has been pushed outside the top three.

Mahindra sold 6,60,276 utility vehicles in the domestic market in FY26, up 20% from 5,51,487 units in FY25. Tata Motors Passenger Vehicles reported domestic sales of 6,31,387 units, a 14% increase from 5,53,585 units. Hyundai, by contrast, saw its domestic volumes decline 2.3% to 5,84,906 units from 5,98,666 units in FY25 — the only contraction among the top four manufacturers.

The gap between Mahindra and Tata is roughly 29,000 units, narrow enough to suggest the contest for the second position remains live heading into FY27. But the gap separating Tata from Hyundai is considerably wider at over 46,000 units, and the distance between Mahindra and Hyundai now stands at over 75,000 units — a margin that would have been unthinkable two years ago.

Different Engines of Growth

The three companies arrived at their FY26 numbers through very different routes. Mahindra's portfolio is entirely SUVs — it sells no hatchbacks, sedans or vans in the domestic market — and its growth has been product-led. The Scorpio-N, XUV700, Thar and Thar Roxx have sustained strong demand through FY26, with the XUV700 and Scorpio-N carrying extended waiting periods for much of the year. With the Indian PV market having tilted decisively toward SUVs, Mahindra's concentrated bet on the body style has paid off.

Tata Motors' growth has been broader-based. Its domestic portfolio spans hatchbacks, sedans, SUVs and electric vehicles, and all segments contributed. The company's EV sales rose 43% year-on-year to 92,120 units in FY26, reinforcing its leadership in the domestic electric PV space. CNG volumes exceeded 1.7 lakh units, growing 24%. And its SUV portfolio, led by the Nexon and Punch — which Tata says were the highest-selling SUV models nationally in H2 FY26 — provided the volume backbone. New launches including the Sierra, the refreshed Punch and petrol variants of the Harrier and Safari added to momentum in the second half.

Hyundai's 2.3% full-year decline points to a structural challenge. Its portfolio is the most diversified of the three, spanning hatchbacks, sedans and SUVs, but that breadth has not translated into growth in a market where SUVs now dominate wholesale volumes. The company continues to lead India's PV export rankings — its FY25 export volume of 1,63,386 units was the highest among Indian PV manufacturers — but export strength has not offset the domestic erosion.

Q4 FY26: Tata Surges, Mahindra Holds, Hyundai Trails

The January-to-March quarter sharpened the divergence further — and introduced a twist. Tata Motors was the largest of the three companies in Q4 FY26 by domestic volumes, selling 1,98,743 units, a 36% increase from 1,46,127 units in Q4 FY25. Mahindra sold 1,83,800 SUVs domestically in the quarter, up 23% from 1,49,127 units. Hyundai recorded domestic Q4 sales of 1,66,578 units, up 8.5% — its highest-ever quarterly domestic tally, but still the smallest of the three.

The quarterly numbers carry a signal. Over the full year, Mahindra led Tata by roughly 29,000 units. But in Q4 alone, Tata outsold Mahindra by nearly 15,000 units. This suggests Tata's second-half momentum — driven by new launches and the EV push — accelerated as the year closed, and the company is entering FY27 on a stronger quarterly run rate than Mahindra.

March 2026, the final month of the fiscal year, underlined the point. Tata sold 66,192 passenger vehicles domestically, up 28% year-on-year. Mahindra sold 60,272 SUVs, up 25%. Hyundai sold 55,064 units, up 6.3%. For the first time in recent memory, Tata led the monthly domestic volumes among the three.

The Road Ahead

The FY26 rankings establish a new order — Maruti, Mahindra, Tata, Hyundai — but the closeness of the Mahindra-Tata contest and the quarterly trajectories suggest this order is not yet settled. Tata's Q4 run rate, if sustained, could challenge Mahindra for the second position in FY27. Shailesh Chandra, MD and CEO of Tata Motors Passenger Vehicles, has said the company expects to deliver "industry-beating growth" in FY27, supported by recent launches and its multi-powertrain strategy. Mahindra, meanwhile, has the XUV 7XO and XEV 9S in the pipeline, both of which drew record bookings when orders opened in January.

Hyundai faces the steeper climb. Tarun Garg, MD and CEO of HMIL, has pointed to upcoming product interventions including the upgraded Verna and Exter as levers for FY27 growth. But with both Mahindra and Tata pulling ahead by significant margins and growing at double-digit rates, Hyundai will need a sharper domestic acceleration to reclaim its former standing.