Sales of Indian SUVs soar, smaller cars skid in December

Sales of sports utility vehicles (SUVs) rose in December, while small car sales fell despite high discounts, data from Indian automakers showed on Monday.

While sales of entry-level vehicles remain slow due to inflation, automakers have benefited from the sales of premium vehicles, catering to a more well-off demographic largely unaffected by higher prices.

Maruti Suzuki (MRTI.NS) and Mahindra & Mahindra (MAHM.NS) reported domestic SUV sales growth of 24% and 39% year-on-year, respectively.

Indian carmakers’ SUV segment has benefitted from strong demand through the last year.

Mahindra, which makes SUVs such as the Thar, Scorpio and XUV, had multiple months of record sales in the category in 2023. It has seen 20%-57% sales growth each month this financial year so far.

Sales of SUVs have formed 36% of Maruti’s domestic passenger vehicle (PV) so far this fiscal year, compared with 22% last fiscal, while accounting for almost all of Mahindra’s PV sales.

The year-end, where automakers usually provide larger discounts, coupled with low demand for entry-level vehicles, prompted Maruti to increase discounts on its lesser-priced models by 40% to 45%.

However, sales of its small cars like the Alto and Baleno were down 29%. That was also, in part, due to Maruti’s moderation of wholesales.

Tata Motors (TAMO.NS) reported an 8% growth in domestic PV sales, without specifying the growth rates of different categories of cars.

Among two-wheelers, Bajaj Auto’s (BAJA.NS) and TVS Motor’s (TVSM.NS) domestic sales jumped 26% and 27% respectively, while Eicher Motors’ (EICH.NS) Royal Enfield motorcycle sales fell 7%.

Bajaj and other two-wheeler makers benefited from the wedding season that took place during the first half of the month, analysts have said.

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  2. Unfortunately, the prices of cars in Pakistan are plummeting with each day passing. Where India is thriving to product premium cars for a lower price, Pakistan is struggling to event control prices of 660cc cars. 2023 has been the worst year for Pakistani automobile market.

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