With 48.7% of India’s car market, the SUV segment held the biggest share in CY23.
The passenger vehicle (PV) volume in the domestic market crossed the historic 4,000,000 units during a calendar year (CY) for the first time in 2023, thanks to strong demand and improvements in the supply chain. Several original equipment manufacturers (OEMs) recorded their highest-ever wholesales.
From 3,792,000 units in CY22 to 4,108,000 units in CY23, the PV volume increased by 8.33%. The increase in wholesales is a result of growth in CY22 of 23% and CY21 of 26.7%. Unexpectedly, CY23’s 12 months all had the highest volume ever for that specific month.
With a 48.7% market share in CY23, the sport utility vehicle (SUV) segment led the hatchback sector (30%), sedan segment (9.4%), and multi-purpose vehicle (MPV) segment (8.7%).
The share of the hatchback and sedan segments decreased over the year from 34.8% and 11%, respectively, in CY22, while the SUV segment’s share increased from 42% in CY22 to 43% in CY23. The share of the MPV segment did not change.
“The SUV segment saw a 26% increase, driving the industry’s expansion. The MPV segment grew by 7.3%, while the van segment increased by 10%. The Maruti Suzuki India Senior Executive Officer of Marketing and Sales, Shashank Srivastava, states that “both the hatchback and sedan segments decreased.”
Srivastava predicts that the SUV market will continue to grow in CY24 and eventually level out at 54-54%. He remarked, “I would expect the hatchback demand to be roughly similar in CY24,” but he added that there might be a further decline in the desire for sedans.
“In CY24, we anticipate a 52–53% increase in the SUV segment,” stated Tarun Garg, COO of Hyundai Motor India.
In the domestic market, Maruti India recorded a respectable PV volume of 1,707,668 units in CY23. Seven Maruti India vehicles were among the top ten best-selling vehicles in the nation for the year. With 203,500 sold, the Swift was the best-selling vehicle, followed by the WagonR with 201,300. With 170,600 sold, the Brezza was the best-selling SUV.
With 602,111 units, Hyundai India recorded its highest-ever domestic PV volume in CY23. SUVs made up 60% of the carmaker’s wholesale sales, although at almost 155,000 units, the Creta continued to be the best-selling model.
With 550,838 units and 433,172 units, respectively, Tata Motors and Mahindra saw their highest-ever PV wholesales in the domestic market in CY23.
Prognosis for 2024
Industry leaders believe that despite a high base from CY23, the domestic auto market will expand in CY24, which is quite encouraging.
We will have a significant volume in CY24 since we have surpassed 4,000,000. However, on this high foundation, the growth will be restricted to a single-digit “added Srivastava.
“We feel that the industry growth could be in a single digit, maybe 3-4%,” Garg added, expressing agreement with Srivastava. But that is also very good, considering we are sitting on two years of back-to-back highest-ever sales.”
“We feel that the industry growth could be in a single digit, maybe 3-4%,” Garg added, expressing agreement with Srivastava. However, that is also really positive given that our sales have reached record highs over the past two years.”
Regarding the positive aspects of CY24, Garg noted that GDP estimates are still rising, the stock market is at an all-time high, and the economy is generally feeling optimistic. This is all the more so in spite of the geopolitical tensions between Russia and Ukraine or between Israel and Palestine. Positively, India seems to be an exception,” he said.
Another benefit for the business, according to Garg, is that new demand is being generated after pent-up demand subsided four to five months ago.