SUVs have continued to expand their presence in India’s passenger vehicle market, increasing their share to 58% in FY27 so far from 56% in the six months before the GST rate cut.
The shift towards larger vehicles in India’s passenger car market has continued even after GST changes provided some support to entry-level hatchbacks.
According to data from JATO Dynamics cited in the report, SUVs accounted for 58% of passenger vehicle sales in FY27 so far. This compares with a 56% share during the six months before the GST rate reduction.
Entry-level hatchbacks, meanwhile, have shown some recovery. Their share increased from 2.3% in the six months before the GST cut to 3.3% during the first five months of FY27.
However, the improvement has largely been confined to entry-level small cars. The broader hatchback segment has remained relatively stable at around 21% of the passenger vehicle market.
The shift towards SUVs is also visible in the used-car market. The data accompanying the report showed SUVs increasing their share of used-car sales over recent periods, while hatchbacks lost ground.
In FY22, hatchbacks accounted for 58.7% of the used-car market compared with 11% for SUVs. By August 2026, hatchbacks’ share had fallen to 47.5%, while SUVs had increased to 24.7%.
The figures show that the growing preference for SUVs is extending beyond new-car purchases into the used-car segment, even as lower taxation provides some support to smaller entry-level vehicles.
