Rapid surges in SUV sales have boosted rural market sales for all carmakers in India, while demand for small cars has declined significantly. In FY24, the Indian passenger vehicle market hit a record-high of 40 lakh PV sales, with SUVs dominating the market.
The Indian passenger vehicle market saw a total of 42.3 lakh units sold in FY24, with one in every two cars being an SUV. This marked an 8.7% year-on-year growth over the previous financial year, setting a new record for the industry.
All major car manufacturers in India experienced record-high sales in rural markets, surpassing urban sales. Maruti Suzuki’s rural sales grew by 11% year-on-year, outperforming urban growth. Hyundai attributed the rise in rural sales to factors like infrastructure development and increased access to information.
Tata Motors noted that rural sales accounted for 40% of its total sales, with models like Tata Nexon and Tiago leading in rural markets. The surge in rural sales was also attributed to models like Punch CNG and Tiago EV, showcasing a shift in consumer preferences towards SUVs in rural areas.
The SUV segment has been a key driver in the growth of rural PV sales, with one in every two passenger vehicles sold in India being an SUV. This shift signifies changing consumer aspirations in rural markets, driven by factors like rising incomes and increased connectivity. The convergence of segment choices between rural and urban consumers indicates a shift in market dynamics towards SUVs.
