New Delhi: After suffering from affordability issues and the onslaught of SUVs, Maruti Suzuki India hopes to revive the small car segment in the domestic market by late 2026 or 2027, according to a senior company official.
The small car segment, which once dominated the Indian total passenger vehicle market, currently accounts for less than 30 percent.
The company hopes that the resurgence seen in the two-wheeler market, which has also seen a decline since 2018-19, will also have a positive impact on small car sales.
"The contribution of the SUV segment to the total (passenger vehicle) industry has gone up to 53.6 per cent, as a result of which the contribution of the small (car segment) has gone down a bit further," said Maruti Suzuki India Senio executive officer, marketing and marketing executive. Sales, Partho Banerjee said in a virtual conversation.He said that there has been a "huge increase in hatchback prices" for a number of reasons, including regulations related to safety and emissions standards, but that "affordability" for small car buyers has not increased to the same extent.
“As a result, the contribution of the hatchback segment has declined, but we believe that this hatchback segment will come back again… We hope that, perhaps by the end of 2026 or 2027, we will again see growth in the hatchback segment and This market will revive,” Banerjee said.
While affordability remains a "big challenge" at the moment, he said the small car segment could benefit positively from the revival seen in two-wheeler sales.
“There has been a revival in the two-wheeler sector. We have seen in the past that whenever there is a revival in the two-wheeler industry, with some lag there is a revival in four-wheelers as well.That's why we're very optimistic that we're going to make headway in the hatch segment,” Banerjee said.
He stressed that it is only a matter of time to revive the small car segment once the affordable segment improves.
"The car penetration ratio in India is only 32 per 1,000 (people)," Banerjee said, bullish on the segment's strong comeback. If you look at all mature markets like Japan, the car penetration ratio per 1,000 (people) is 600 and we are moving into that. The direction is expected that by 2030, we will reach 44 cars per thousand.,
Obviously, he said, "People will migrate more from two-wheelers to four-wheelers. So there is no reason why I should think that this small car segment is not going to be revived. It is only a matter of time." "
The share of small cars in India's overall PV market was 47.4 percent in FY2018 and 46 percent in FY2019. In FY2020, it improved marginally to 46.5 per cent and has been declining since then.In FY21, it was 45.6 per cent, 37.5 per cent in FY22, 34.4 per cent in FY23 and 27.7 per cent in FY24.
The small car segment, which once dominated the Indian total passenger vehicle market, currently accounts for less than 30 percent.
The company hopes that the resurgence seen in the two-wheeler market, which has also seen a decline since 2018-19, will also have a positive impact on small car sales.
"The contribution of the SUV segment to the total (passenger vehicle) industry has gone up to 53.6 per cent, as a result of which the contribution of the small (car segment) has gone down a bit further," said Maruti Suzuki India Senio executive officer, marketing and marketing executive. Sales, Partho Banerjee said in a virtual conversation.He said that there has been a "huge increase in hatchback prices" for a number of reasons, including regulations related to safety and emissions standards, but that "affordability" for small car buyers has not increased to the same extent.
“As a result, the contribution of the hatchback segment has declined, but we believe that this hatchback segment will come back again… We hope that, perhaps by the end of 2026 or 2027, we will again see growth in the hatchback segment and This market will revive,” Banerjee said.
While affordability remains a "big challenge" at the moment, he said the small car segment could benefit positively from the revival seen in two-wheeler sales.
“There has been a revival in the two-wheeler sector. We have seen in the past that whenever there is a revival in the two-wheeler industry, with some lag there is a revival in four-wheelers as well.That's why we're very optimistic that we're going to make headway in the hatch segment,” Banerjee said.
He stressed that it is only a matter of time to revive the small car segment once the affordable segment improves.
"The car penetration ratio in India is only 32 per 1,000 (people)," Banerjee said, bullish on the segment's strong comeback. If you look at all mature markets like Japan, the car penetration ratio per 1,000 (people) is 600 and we are moving into that. The direction is expected that by 2030, we will reach 44 cars per thousand.,
Obviously, he said, "People will migrate more from two-wheelers to four-wheelers. So there is no reason why I should think that this small car segment is not going to be revived. It is only a matter of time." "
The share of small cars in India's overall PV market was 47.4 percent in FY2018 and 46 percent in FY2019. In FY2020, it improved marginally to 46.5 per cent and has been declining since then.In FY21, it was 45.6 per cent, 37.5 per cent in FY22, 34.4 per cent in FY23 and 27.7 per cent in FY24.
