Mahindra Emerges as the New No.2 in FY26

For years, India's passenger vehicle hierarchy below Maruti Suzuki appeared settled: Hyundai Motor India at second, with Tata Motors and Mahindra & Mahindra trading the third and fourth slots depending on the quarter. FY 2025-26 dismantled that order comprehensively. Mahindra climbed to second position on both wholesale dispatches and retail registrations, Tata Motors moved to third, and Hyundai — for the first time in recent memory — finished fourth on both counts.

In FADA's retail data, Mahindra commanded a 13.42 per cent market share for FY26 with 6,31,638 units registered at RTOs — up from 12.42 per cent and 5,17,081 units in FY25, a jump of 100 basis points and over 1.14 lakh incremental units. Tata Motors followed at 13.04 per cent (6,13,513 units, up from 12.87 per cent), and Hyundai slipped to 12.29 per cent (5,78,337 units) — a sharp contraction from 13.48 per cent and 5,61,103 units a year earlier.

On the wholesale side, the picture aligns. Mahindra sold 6,60,276 utility vehicles in the domestic market in FY26, a 20 per cent surge from 5,51,487 units. Tata's domestic PV dispatches hit 6,31,387 units (+14 per cent from 5,53,585). Hyundai's domestic wholesale tally fell to 5,84,906 units, a 2.3 per cent contraction from 5,98,666 units — the only top-four OEM to register negative growth.

Wholesale vs Retail

The convergence of wholesale and retail rankings is itself a notable development. In previous years, wholesale and retail rankings occasionally diverged — an OEM could lead on dispatches but trail on registrations if dealer inventory was building up. In FY26, the alignment between the two metrics suggests that Mahindra's volume growth has been demand-led rather than channel-stuffed. This reading is corroborated by the broader industry trend: PV inventory normalised from approximately 52 days in March 2025 to around 28 days by March 2026, the healthiest level in recent memory.

A closer look at the wholesale-retail spread for each company is instructive. Mahindra dispatched 6,60,276 units but registered 6,31,638 — a gap of approximately 28,600 units, suggesting moderate pipeline inventory consistent with a company managing supply against sustained order backlogs. Tata dispatched 6,31,387 and registered 6,13,513 — a tighter gap of about 17,900 units, indicating lean channel management. Hyundai dispatched 5,84,906 and registered 5,78,337 — a gap of roughly 6,600 units, the narrowest of the three, which reflects both lower volumes and the fact that Hyundai's inventory correction has been particularly aggressive through the year.

What drove Mahindra's climb

Mahindra's ascent has been almost entirely product-driven, and it rests on an unusual structural bet: Mahindra is the only top-five PV manufacturer with an SUV-only domestic portfolio. It sells no hatchbacks, no sedans, no vans. In a market where SUV body styles now account for over half of all PV sales, this concentration has shifted from being a perceived limitation to a decisive advantage.

The product lineup reads like an SUV playbook calibrated to cover every price band from Rs 7 lakh to Rs 25 lakh. The XUV700, which starts at around Rs 14 lakh, and the Scorpio-N have carried sustained order backlogs through much of FY25 and FY26 — a supply-constrained demand situation that most automakers would envy. The Thar, repositioned from a niche off-roader to a lifestyle vehicle, continued to clock healthy volumes. And the Thar Roxx, launched in August 2025, added a new demand pool by offering a five-door, family-friendly iteration of the Thar platform.

Nalinikanth Gollagunta, CEO of M&M's Automotive Division, framed the year-end performance: "The financial year ended on a very positive note, with Mahindra clocking its highest-ever volumes in both SUVs and LCVs (<3.5T) segments, a significant milestone for the company. In March, we achieved SUV sales of 60,272 units, a growth of 25%, and LCV <3.5T sales of 24,928 units, a growth of 11% YoY."

The March wholesale of 60,272 SUVs — up 25 per cent from 48,048 a year earlier — illustrates the sustained momentum. Interestingly, Tata actually outsold Mahindra in March on both wholesale (66,192 vs 60,272) and retail (65,784 vs 61,029), but the full-year lead Mahindra had built through consistent month-on-month performance proved insurmountable.

Hyundai's Slide

The more consequential question in these numbers is what Hyundai's contraction means — particularly in the context of the company's October 2024 IPO on the Indian exchanges. Hyundai Motor India listed at a time when its domestic market position appeared stable at around 13.5 per cent share. Eighteen months later, that share has eroded to 12.29 per cent, and the full-year wholesale volume has contracted 2.3 per cent in a market that grew 13 per cent on retail.

The gap between Hyundai's growth rate and the market's growth rate is the sharpest among the top four. Maruti grew its retail share by approximately the market rate, Mahindra and Tata both grew faster than the market, and Hyundai was the sole top-four player to register both share loss and absolute volume decline.

Several factors explain the erosion. Hyundai's product portfolio, while broad, is increasingly misaligned with where the Indian market's growth is concentrated. The company's strongest sellers — the Creta, Venue, i20 and Grand i10 Nios — span hatchbacks, premium hatchbacks and compact SUVs. But in a market where the sub-Rs-12-lakh SUV segment (where the Punch, Nexon, Brezza, Fronx, Scorpio-N entry variants and XUV700 base trims all compete) has seen the most explosive growth, Hyundai's portfolio has fewer entries at the most contested price points.

The Creta remains a formidable product — arguably the segment benchmark — but it competes in the Rs 11-20 lakh band where competition has intensified sharply with the Tata Curvv, Mahindra XUV700, Kia Seltos and Maruti Grand Vitara/Fronx. The Venue, positioned below the Creta, has faced pressure from the Tata Punch (which has expanded into a broader family of variants) and the Maruti Brezza.

Hyundai also lacks a CNG portfolio of the depth that Maruti and Tata now offer. With CNG's PV share climbing to 21.98 per cent in FY26, this is an increasingly costly gap.

The export dimension offers some comfort. Hyundai's FY25 export volume of 1,63,386 units (the most recent full-year figure) is the highest among Indian PV manufacturers, and the company's dual-market strategy — using India as both a domestic and export production base — means that factory utilisation remains healthy. But export strength does not show up in domestic market share, and for Indian investors who bought into Hyundai Motor India's IPO, domestic share trajectory is the metric that matters most.

Is the slide structural? The evidence is mixed. On one hand, Hyundai's product pipeline is not empty — refreshed Creta variants, the electric Creta EV (expected in FY27), and a broader EV push should provide new demand. On the other hand, the structural shift toward SUV-only portfolios (Mahindra), multi-powertrain strategies (Tata's EV + CNG + ICE approach), and aggressive value pricing (Maruti's CNG-led portfolio) represents a competitive environment that has moved decisively since Hyundai's listing. The 119-basis-point share erosion in a single year is not something that a single product launch can reverse; it suggests that the competitive structure of the Indian PV market has shifted beneath Hyundai's feet.

The FY26 PV rankings — Maruti (39.71 per cent), Mahindra (13.42 per cent), Tata (13.04 per cent), Hyundai (12.29 per cent) — may well prove durable. Mahindra's SUV concentration is a tailwind as long as India's ‘SUV-ification’ continues. Tata's multi-powertrain portfolio and EV leadership provide structural support. Hyundai will need to execute on both product and powertrain diversification to arrest the slide.