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India’s auto industry, long buoyed by the relentless rise of sport utility vehicles (SUVs), witnessed an unexpected twist in June 2025. For the first time in more than five years, monthly SUV sales registered a decline, signaling a shift in consumer sentiment amid broader economic headwinds. The drop, though modest at 2.1 percent, has raised eyebrows across the industry, especially given the segment’s dominance in recent years.
Key Highlights from June’s Sales Performance
- SUV sales fell to approximately 175,000 units in June 2025, down 2.1 percent year-on-year
- This marks the first monthly contraction in SUV volumes since the pandemic era
- SUVs currently account for 55 percent of all passenger vehicles sold in India
- The slowdown comes after years of double-digit growth: 42 percent in FY22, 36 percent in FY23, and 27 percent in FY24
- Q1 FY26 saw SUV growth slow to 5.6 percent, a sharp drop from 11.3 percent in FY25
Economic Challenges Behind the Decline
- Layoffs in the IT sector have dampened urban demand, particularly in tech-driven cities like Bengaluru and Pune
- Geopolitical uncertainties and inflationary pressures have led to cautious consumer spending
- Rising vehicle costs, driven by regulatory mandates such as six airbags across models, have impacted affordability
- Financing hurdles and higher interest rates have further strained first-time buyers
- Rural demand has also softened, growing only 2–3 percent compared to 10 percent last year
Segment-Wise Trends and Brand Performance
- Maruti Suzuki, India’s largest carmaker, saw a 13.3 percent year-on-year drop in June sales, dispatching 118,906 units
- Hyundai reported a 12.1 percent decline, selling 44,024 units
- Tata Motors experienced a 14.8 percent fall, with 37,083 units sold
- Mahindra bucked the trend with an 18.2 percent increase, selling 47,306 units, driven by strong SUV demand
- Kia’s sales dipped 3.2 percent, while MG Motor posted a 25.5 percent rise, largely due to EV traction
- Renault and Nissan continued to struggle, with declines of 26.1 percent and 37.7 percent respectively
Top-Selling SUVs in June 2025
- Maruti Brezza and Grand Vitara retained top spots despite the slowdown
- Hyundai Venue and Mahindra XUV 3XO rounded out the top ten, with 6,858 and 7,089 units respectively
- Tata Nexon and Punch saw notable declines, reflecting broader brand challenges
- Kia Syros emerged as a bright spot, contributing over 24,000 units in H1 2025
Industry Outlook and Recovery Signals
- Automakers remain cautiously optimistic, banking on the upcoming festive season to revive demand
- New launches, including updated versions of popular models like Hyundai Venue and Tata Harrier, are expected to boost showroom footfalls
- EVs and hybrids continue to gain traction, offering a potential buffer against declining ICE vehicle sales
- Government support through revised tax slabs and increased minimum support prices (MSP) may aid rural recovery
- Industry experts suggest that while June’s dip is notable, it may be a temporary blip in a long-term growth story
Conclusion
June 2025’s dip in SUV sales marks a rare moment of pause in India’s otherwise booming utility vehicle market. While macroeconomic challenges have clearly impacted buyer sentiment, the segment’s resilience and adaptability—especially through EVs and new launches—could help it bounce back swiftly. For now, automakers are recalibrating strategies, and all eyes are on the festive season to reignite the SUV spark.
Sources: Economic Times, RushLane, DriveSpark, India Car News, Nxcar Insights, MSN Auto, News18 Auto
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