Maruti Suzuki Sees India PV Industry Growing 1-2% in FY26; Expects to Outpace the Market Growth

Japanese automaker Suzuki Motor Corp on Monday said India’s passenger vehicle industry is projected to see a growth of 1-2% during the financial year 2026 (2025-26) and its India subsidiary Maruti Suzuki India is banking on two new SUV launches in the year to outpace the broader market growth.

“As for the outlook for FY2025 (2025-26), although SUVs continue to be strong in the market, demand for compact cars continues to be sluggish, and the overall market for wholesale sales is expected to grow by +1~2%,” Suzuki Motor said in a recent earnings presentation. 

Suzuki’s growth estimate is almost in line with what Maruti Suzuki had projected at the SIAM Looking Ahead Conclave at the beginning of this year. Passenger vehicle volume in India, the third-largest car market in the world, during the financial year 2025 saw a similar 2% on-year growth with wholesales of 43.02 lakh (4.31 million) units.

India market accounts for 55% of Suzuki Motor’s global car volume, down from 56.6% from the year-ago period. The slight reduction in the share of Maruti Suzuki to global volumes comes as the automaker’s total volume in 2024-25 remained almost flat at 17.95 lakh units, while Suzuki Motor’s global volume rose 3.2% to 32.40 lakh units.

India’s passenger vehicle industry has been slogging over the last two years with low single-digit growth. The slowdown in the growth rate reflects de-growth in the entry-level, or small hatchbacks, which has been the segment that brings a lot of first-time buyers to the car market from the two-wheeler market. 

Utility vehicles, which include SUVs and MPVs, have been the major growth drivers of the passenger vehicle industry. The share of utility vehicles in the domestic passenger vehicle industry has now increased to over 65% from around 35% at the start of this decade, whereas the share of hatchbacks and sedans) has declined to around 31% from 61%.

“What’s happening is people can’t afford small cars anymore…Only around 12% of households in India earn over Rs 12 lakh annually and can consider buying a car priced at Rs 10 lakh or more…Car buying in India is largely restricted to this 12%. How can you expect growth when 88% of the country is at a level where they cannot afford these cars?” Maruti Suzuki Chairman RC Bhargava said recently.

Maruti Suzuki to Outpace Market Growth

India’s largest carmaker is targeting to outpace the 1-2% industry growth projected for the current financial year. The automaker, which has been enhancing its SUV portfolio to improve its market share, plans to launch two new SUVs during the year.

The company currently has a portfolio of six utility vehicle models - Ertiga, Brezza, Grand Vitara, Jimny, XL6 and Invicto. It also sells a compact crossover – Fronx. The automaker has already unveiled its first battery electric car e Vitara, which is also an SUV.

“With the launch of two new SUVs, including the BEV e VITARA, our company plans to outpace market growth,” Suzuki Motor said. “In the summer of 2025, we plan to launch the e VITARA, Suzuki's first battery EV. Sales will begin in India, Europe, Japan and other countries around the world.”

India is the global production and export hub for Suzuki’s electric vehicles. Maruti Suzuki is targeting to expand its annual production capacity to 40 lakh units from the current __ units by the end of the decade to cater to both domestic and export demand.

The company did not disclose more details on the new SUV. Autocar Professional has reported that Maruti Suzuki is likely to launch a larger sibling based on the Grand Vitara platform, internally codenamed Y17, with a hybrid powertrain. The model will also be sold under the Toyota brand.

Maruti Suzuki recently started production at its new Kharkhoda plant in Haryana, which Suzuki said is supporting in higher production and sales of Brezza.

The automaker is the largest exporter of cars from India. Facing sluggish growth in the domestic market, Maruti Suzuki is looking at exports as a strategic pillar for growth. After posting 17% growth in exports with 3.3 lakh units in FY25, the carmaker is now targeting to boost exports further with 20% growth in FY26.

Meanwhile, Suzuki Motor has earmarked 380 billion Japanese Yen as total capital expenditure in the current financial year with approximately 50% of it for India business. The automaker will invest to expand its Kharkoda plant and establish a new production line at its existing Gujarat facility. Additionally, Maruti Suzuki is developing a new plant in Gujarat.