Passenger Vehicle Sales In India See Marginal Growth In FY25

Passenger vehicle (PV) dispatches to Indian dealerships saw a modest 2.6% year-on-year (Y-o-Y) increase in FY25, reaching 4.34 million units.

This growth, significantly lower than the 9% jump in FY24, was hindered by a high base effect, subdued urban demand, and weak sales in the hatchback and sedan segments.

Industry-wide wholesale figures for March 2025 stood between 380,000 and 390,000 units, slightly above the 368,016 units recorded in March 2024.

Partha Banerjee, head of marketing and sales at Maruti Suzuki India Limited (MSIL), noted, “The post-pandemic demand surge was unsustainable. Growth was expected to slow after the high base of FY24.”

Hatchbacks & Sedans Struggle

Hatchback and sedan sales continued their downward trend in FY25.

Maruti Suzuki, the market leader in this segment, saw small car sales fall to 904,909 units from 980,446 in FY24.

Hyundai Motor India (HMIL) also posted a 2.6% decline in PV dispatches to 598,666 units, while Tata Motors recorded a 3% drop to 553,585 units.

Tata’s PV and EV division head, Shailesh Chandra, called FY25 a ‘challenging year marked by fluctuating demand’.

Despite the slowdown, the SUV segment continued to perform well. Tata’s Punch became India’s top-selling SUV in FY25, highlighting changing consumer preferences.

Mixed Fortunes For Automakers

While some carmakers faced headwinds, Mahindra & Mahindra (M&M) and Toyota Kirloskar Motor (TKM) bucked the trend.

M&M’s domestic sales surged 27.9% Y-o-Y to 337,148 units, while TKM posted a 19.9% increase to 551,487 units.

Varinder Wadhwa, head of sales at TKM, attributed this growth to ‘strong and consistent adoption of SUVs, MPVs, and hybrids, reinforced by deeper engagement in Tier II and III cities’.

Exports Offer A Boost

India’s auto exports provided a crucial cushion for some manufacturers.

Maruti Suzuki’s exports grew 17.5% Y-o-Y to 332,585 units in FY25.

Looking ahead, MSIL’s corporate affairs head, Rahul Bharti, projected continued export growth. “By 2030, we aim to export 750,000-800,000 units annually. The launch of the e-Vitara in 2025-26 will further boost our EV exports.”

Outlook For FY26

Industry experts anticipate a further slowdown in FY26, with the Society of Indian Automobile Manufacturers (SIAM) forecasting growth of just 1-2%.

Banerjee cautioned that ’15-20% growth cannot be expected’, citing macroeconomic factors such as inflation, infrastructure spending, and global geopolitical trends as key determinants of future demand.

With the PV market stabilizing post-pandemic, automakers are focusing on SUV dominance, electric vehicle (EV) expansion, and export growth to sustain momentum in an increasingly competitive landscape.

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