2023 was the third straight year of record sales for Tata Motors, which boasts the widest range of electric vehicles in its portfolio. Sales last year totalled 553,000, “led by its commanding position in the compact SUV segment and strong growth in hatches, despite the hatch segment degrowing at an industry level”, said Shailesh Chandra, managing director, of Tata Motors Passenger Vehicles and Tata Passenger Electric Mobility. 0.7 basis point. We have indeed been gaining share in SUVs, but most of these models have come in only recently.”
Vehicle penetration in India – 31-32 per 1,000 persons – is among the lowest in major car markets. All Comments Maruti Suzuki, with a share of 68% in the small-car segment, has completely revamped its range with a clear SUV focus. The originator of the small car revolution in India launched the Grand Vitara, Fronx and Jimny as well as a facelifted Brezza – all classed as SUVs – in the past 18 months to double its share in the fast-growing category to 20% by the close of 2023.
The company sold 836,000 hatchbacks last year, down from 987,000 units in 2018. SUV sales totalled 395,000 units in 2023, up from about 202,000 units in 2018. However, Srivastava is optimistic that as affordability improves, first-time buyers will come back to small cars at the entry-level, though the preference for body styles may change, resembling small SUVs rather than hatchbacks.
“India is a growing economy – the demand for transportation will only increase,” he said. “The cross-consideration between traditional hatchbacks and micro SUVs is likely to get higher, but demand for cars at the entry-level will continue to be there because of low vehicle penetration and our demographics.”
As much as 65% of the country’s population is aged less than 35 years, a demographic that will fuel consumption across industries in the coming years, according to economists. The International Monetary Fund (IMF) has projected India will become a USD 5 trillion economy with the third-highest GDP by FY2028. Hyundai Motor India (HMIL) has seen a “phenomenal” increase in aspiration levels among buyers in India, which will drive growth in the industry, said Tarun Garg, chief operating officer (COO).
“In even a micro SUV like Exter, we have seen 77% of the demand come in from variants with sunroofs,” he said. “Vehicle prices have increased. But the average age of our buyers has come down by five years in the last five years. Consumers today want everything – connected features, advanced tech, and safety – and are willing to
pay more for them.”
Demographics will play “the most important role” in driving growth in the country, he said. Hyundai increased car sales by 9% to a record 602,111 units in the local market in 2023, bettering the previous year’s peak of 552,511 units.
2023 was the third straight year of record sales for Tata Motors, which boasts the widest range of electric vehicles in its portfolio. Sales last year totalled 553,000, “led by its commanding position in the compact SUV segment and strong growth in hatches, despite the hatch segment decreasing at an industry level”, said Shailesh Chandra, managing director, of Tata Motors Passenger Vehicles and Tata Passenger Electric Mobility. “Going forward, with multiple new products, including a new nameplate scheduled for launch in CY2024, we remain optimistic about continuing the growth trend in the quarters ahead.”