Consumer tastes can change quickly in the auto industry. And the gain in popularity of SUVs over the last two years has left India’s market leader Maruti Suzuki flat-footed, and on the defensive.
The July retail sales data, released by the Federation of Automobile Dealers Associations (FADA) shows Maruti Suzuki’s stranglehold on the Indian car market waning as a result of this shift.
Maruti Suzuki’s retail market share fell 11 percentage points to 39.2% over the past two years (till end July 2022). Its retail sales fell below 1 lakh units in July 2022 for the first time in ten months.
The two companies that have gained at Maruti Suzuki’s expense are South Korean carmaker Hyundai Motor India, and Tata Motors. Both these companies are vying for the second spot in the Indian car market., Tata Motors and Hyundai were neck-to-neck at second place in retail market share in June this year, but the South Korean carmaker pulled ahead of Tata Motors in July to take the second position.
The preference towards sports utility vehicles is helping Tata Motors, Hyundai, Mahindra & Mahindra and Kia Motors grab market share from Maruti Suzuki.
Maruti is still India’s largest car maker, but it’s playing catch-up in the SUV market. Its new launches in the SUV space however, are making waves with record bookings. Investors will be watching to see if its new products help it claw back the customers it lost over the past two years.
