Indians’ love for utility vehicles boosts passenger vehicle sales in Q1FY24

Indians’ love for utility vehicles boosts passenger vehicle sales in Q1FY24

Despite flat sales in other categories, massive jump in UV sales lifted the market

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Indians’ love for utility vehicles boosts passenger vehicle sales in Q1FY24Indians’ love for utility vehicles boosts passenger vehicle sales in Q1FY24
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Arnab Dutta
  • Jul 12, 2023,
  • Updated Jul 12, 2023 3:07 PM IST

Despite tepid sales of hatchback and sedans, the massive jump in sales of utility vehicle (UV) saved the day for domestic passenger vehicle (PV) makers. As more Indian car lovers tilt towards UVs, the local market is growing highly dependent on the category for growth.

Latest data from Society of Indian Automobile Manufacturers (SIAM) shows that during the April-June quarter of financial year 2023-24 (FY24) domestic PV sales remained flat at 413,723 units compared to 411,507 units in the corresponding period last year. However, the total domestic sales of PVs surged 9.4 per cent year-on-year to 995,974 units, up from 910,495 units, thanks to massive jump in sales of UVs.

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In the quarter, domestic UV sales jumped 17.7 per cent to 546,603 units, lifting the overall numbers for the industry to an all-time high. In fact, in June it was UVs that kept the numbers in the positive zone as sales of other categories of cars declined 12 per cent to 116,375 units. In June last year, the industry had recorded domestic sales of 132,342 units. In comparison, UV sales in the domestic market jumped 16.1 per cent in June to 154,520 units—up from 133,076 last year.

According to Vinod Aggarwal, President, SIAM, some sub-segments have shown slight momentary decline. “With expectations of a reasonable monsoon, which has now covered most parts of the country, coupled with lowering inflation, we expect the economy to continue to grow, which in turn should help the Auto Sector. High interest rates remain a concern,” he said.

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The rise of UVs in India is now widely distributed, unlike a few years ago when the high-income urban consumers used to boost the category. Leading player Maruti Suzuki, which was less aggressive in the segment even five years ago, is now heavily focused in the category. The company has recently introduced its priciest model Invicto with an ex-showroom starting price of Rs 24.79 lakh to compete with Tata, M&M, MG and Toyota.

Despite tepid sales of hatchback and sedans, the massive jump in sales of utility vehicle (UV) saved the day for domestic passenger vehicle (PV) makers. As more Indian car lovers tilt towards UVs, the local market is growing highly dependent on the category for growth.

Latest data from Society of Indian Automobile Manufacturers (SIAM) shows that during the April-June quarter of financial year 2023-24 (FY24) domestic PV sales remained flat at 413,723 units compared to 411,507 units in the corresponding period last year. However, the total domestic sales of PVs surged 9.4 per cent year-on-year to 995,974 units, up from 910,495 units, thanks to massive jump in sales of UVs.

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In the quarter, domestic UV sales jumped 17.7 per cent to 546,603 units, lifting the overall numbers for the industry to an all-time high. In fact, in June it was UVs that kept the numbers in the positive zone as sales of other categories of cars declined 12 per cent to 116,375 units. In June last year, the industry had recorded domestic sales of 132,342 units. In comparison, UV sales in the domestic market jumped 16.1 per cent in June to 154,520 units—up from 133,076 last year.

According to Vinod Aggarwal, President, SIAM, some sub-segments have shown slight momentary decline. “With expectations of a reasonable monsoon, which has now covered most parts of the country, coupled with lowering inflation, we expect the economy to continue to grow, which in turn should help the Auto Sector. High interest rates remain a concern,” he said.

Advertisement

The rise of UVs in India is now widely distributed, unlike a few years ago when the high-income urban consumers used to boost the category. Leading player Maruti Suzuki, which was less aggressive in the segment even five years ago, is now heavily focused in the category. The company has recently introduced its priciest model Invicto with an ex-showroom starting price of Rs 24.79 lakh to compete with Tata, M&M, MG and Toyota.

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