M&M Overtakes Hyundai to Become No.2 player in Q1 PV sales; Tata Motors Out of Top 3

For the first time in a quarter, Mahindra & Mahindra Ltd has emerged as the second largest player in the domestic passenger vehicle market during the first quarter of the financial year 2026 with its highest ever market share. The SUV maker's surge has reshuffled the leadership board, pushing Hyundai Motor India and Tata Motors down to the third and fourth places, respectively.

In the April-June quarter, M&M’s domestic passenger vehicle dispatches rose 22.4% to 1.52 lakh vehicles from 1.24 lakh vehicles sold in the year-ago period. This comes at a time when the overall domestic passenger vehicle market sales contracted by 1.3% on year to 1.01 lakh vehicles, according to the data released by the Society of Indian Automobile Manufacturers (SIAM).

Only Mahindra & Mahindra (M&M), Skoda, Kia, and Toyota managed to increase their sales, defying a broader trend. All other passenger vehicle giants faced a challenging quarter, with leading carmaker Maruti Suzuki reporting a 6% year-on-year volume drop to 3.94 lakh units. Hyundai's sales fell by a sharper 11.5% to 1.32 lakh units, while Tata Motors' wholesales declined 9.7% to 1.29 lakh units.

In a notable shift in market share, M&M significantly expanded its presence from 12.1% to 15%. Conversely, India's top three carmakers saw their shares decline: Maruti Suzuki's fell to 38.9% from 40.8%, Hyundai's to 13% from 14.5%, and Tata Motors' to 12.8% from 13.9%, respectively. The retail vehicle sales data from the Federation of Automobile Dealers Associations also shows that M&M has been the second-largest OEM in the passenger vehicle market in the April-June quarter.

Industry experts attribute M&M's exceptional performance to its robust SUV portfolio. 

“Mahindra’s proactive product strategy and agility in responding to market shifts—evident through timely price revisions, frequent model updates, and the consistent introduction of premium features—have propelled it to the second position,” said Gaurav Vangaal, associate director for Light Vehicle Production Forecast at S&P Global Mobility.

“M&M has surged to become the second-largest PV OEM in Q1FY26 — a position we expect it to retain through FY26, driven by robust demand for flagship models like Thar Roxx, XUV700, Scorpio, and the newly launched BEVs,” said Raghunandhan NL, director at Nuvama Institutional Equities.

The passenger vehicle category experienced a widespread downturn this quarter, with all major entry or small car segments in hatchbacks, sedans, and SUVs registering a decline. While the mini, hatchback, and sedan markets have been contracting for an extended period, this quarter notably saw the sub-4-meter SUV segment also register a decline, marking a potential first in recent years.

Approximately one in three passenger vehicles sold in India are sub-4-meter utility vehicles priced under Rs 20 lakh. With the prolonged decline in the demand for hatchbacks and sedans, the segment has been a major growth engine for all the major players, including Maruti Suzuki, Hyundai and Tata Motors.

Unlike competitors, M&M has strategically focused on this segment, avoiding diversion of efforts into the hatchback and sedan categories, which have experienced consistently weak demand for years.

“Its strategic non-participation in the hatchback segment is further fueling market share gains. Domestic PV share has climbed sharply from 7% in FY22 to 13% in FY25, and is poised to reach 14% by FY27E. After delivering an impressive 35% domestic volume CAGR over the past three years, we forecast a healthy 10% CAGR over the next two,” he added.

Hyundai's declining market share could be attributed to a lack of aggressive product action, with reliance on popular models like Creta. For Tata Motors, the Curvv launch has not generated the expected momentum, partly due to cannibalization of Nexon sales and challenges in EV fleet demand. Both companies face intensifying competition and shifting consumer preferences.

“Hyundai’s slower pace of new additional nameplate launches has dampened its competitive edge, while Tata’s delayed rollouts and Curvv’s underwhelming market traction have limited its momentum. Mahindra in recent times added multiple new nameplates in its portfolio, which is helping them gain numbers,” Vangaal added.

Commenting on the overall weakness in the automobile market, SIAM President Shailesh Chandra, who is also the managing director of Tata Motors Passenger Vehicles and Tata Passenger Electric Mobility, said: “Overall sentiments across categories have remained subdued so far, even as the industry continues to navigate supply-side challenges.”

Despite overall GDP growth holding steady and inflation moderating compared to previous years, rural and semi-urban consumption remains under pressure. Factors such as unseasonal rainfall, high food price inflation, and stagnant wage growth in the informal sector have curtailed discretionary spending across key automobile categories.