The utility vehicle segment, led by SUVs, has sailed past passenger cars for the first time in nine months this year following an unrelenting surge in demand from buyers. If the trend continues, utility vehicles could emerge as the best-selling body style by the close of FY22, a first in a full year.

According to data shared by the Society of Indian Automobile Manufacturers (SIAM), total sales in the UV segment, which includes sports utility vehicles or SUVs, stood at 1.03 million units as at the end of December, 2021 compared to sales of 1.02 million units recorded in the passenger car segment during the same period.

Share of UVs in the passenger vehicle category jumped to 48.21 percent during the same nine months from 38.08 per cent recorded in the same period last year. The share of passenger cars slumped to 47.92 per cent this year from 57.82 per cent recorded in the same period last year. The balance of share which is under 4 per cent represents the van segment.

Preferred for their high seating stance, better road view, more space, better loading capacity and better recall among consumers, SUVs have been on a northward climb since the past several years. The number of buyers choosing an SUV body style as their first car is also climbing with there being no dearth of model offerings in the sub ₹7 lakh category. There are as many as 15 offerings in the UV segment priced under ₹10 lakh.

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Bestsellers

While traditional bestsellers like Hyundai Creta, Maruti Suzuki Brezza, Tata Nexon and Kia Seltos continue to do brisk business, newer additions like Renault Kiger, Tata Punch, Skoda Kushaq, Mahindra XUV700 and Volkswagen Taigun are gaining momentum as well. Barring the Hyundai i20 N Line there has not been any hatchback launches in nearly two years. 

Shashank Srivastava, Senior Executive Director, Marketing and Sales, Maruti Suzuki India said, “The sub 4-metre category enjoy concessional GST rate benefit. As a result, there is a price overlap between the entry sedan, premium hatchback and entry level SUVs. Hence the cross consideration for consumers have increased across segments including SUVs. This phenomenon is visible strongly in the entry SUV segment which is driving this growth.”

According to Srivastava, the entry SUV segment accounts for 22 per cent of the market and around 50 percent of the overall SUV market. Hence the entry SUV market which was around 4-5 percent in 2016 has now grown by multi-folds. There are about 43 brands in overall SUV segment in India.

Tarun Garg, Director (Sales, Marketing & Service), Hyundai Motor India said, “More than 40 percent of the more than 100,000 units order book for us is made up of Creta alone. There is a waiting period on our SUVs including the Venue. The growth in SUVs is (however) happening at the cost of hatchbacks.”

From a contribution of 47 percent in 2020, hatchbacks fell to less than 41 percent in 2021 as automotive companies shifted focus to SUV due to rising consumer demand.

According to Garg, compact low hatch segment dropped from 10.9 per cent to 8.8 per cent, compact mid hatch dropped from 11.6 percent to 9.7 per cent and compact high hatch fell from 11.6 percent to 10.3 per cent. Compact premium, while remaining the largest of the hatchback segments, recorded a drop from 13 percent to 12 percent till November. Sedans have also fallen from 11.4 percent share to 9.6 per cent.

MUV category

Multi-utility vehicles (MUV) have also hit a high note among buyers. Favoured for their roominess and load carrying capability, these people carriers have been in high demand. Maruti Suzuki Ertiga, Renault Triber, Mahindra Bolero, Maruti Suzuki XL6 and Toyota Innova Crysta clock more volumes compared to several hatchbacks.