Micro-SUV Sales On The Rise In India – Hyundai Exter, Tata Punch Take The Lead

India’s automotive market is experiencing a surge in demand for micro SUVs, providing a much-needed boost to the domestic car industry amid a general slowdown this year. Models like Hyundai Exter and Tata Punch, are leading the way. Both priced under 10 lakh, saw a 72% increase in sales during the first four months of this financial year. This growth far outpaces that of the overall domestic passenger vehicle sales, which amounts to just 1.8%.

Data from Jato Dynamics shows that 175,330 small SUVs were sold between April and July 2024, a significant jump from the 101,855 units mark during the same period last year. The additional 73,475 units sold in this segment helped offset a decline in hatchback and small car sales, which dropped by 69,936 units during the same period.

Tata Punch and Hyundai Exter seem to drive the most small SUV sales. The entry-level variants of the Brezza, Venue and Nexon are also in high demand. This indicates a price hotspot, tapping which right, could bring fortunes to manufacturers.

The Exter-Punch Numbers Game

Between April and July 2024, the share of small SUVs in vehicles under Rs 10 lakh, increased by 11%. This came at the expense of hatchbacks, which saw a 17% decline in sales during the same period. Sales of micro SUVs now account for 13% of the overall SUV market between January and August 2024, up from 9.8% in 2023.

The Exter and Punch have been breathing volumes in to the B-SUV segment. Both these vehicles have most of their variants priced under 10 lakh. Talking August numbers, The Punch sold 15, 643 units, while the Exter could sell only 6,632 units.

In the case of Exter, the August numbers indicate a year-on-year de-growth of 11%. To give you more context, Hyundai had launched the Exter in July 2023. On a month-on-month basis, the Exter sales have had a growth of 10%, as just 6,037 units were sold in July this year.

Tata Punch, on the other hand, recorded 8% Y-o-Y growth, by selling 15, 643 in August 2024, against the 14,523 units sold in Aug 2023. On a month-on-month basis, sales dropped by 3%, as Tata had posted sales of 16,121 units of the Punch last month. Tata Motors has updated the Punch with more features including a single-pane sunroof. The same is expected to boost sales further.

Also to note here is the fact that the Punch has multiple powertrains on offer- from NA petrol to CNG and EV. Exter, on the other hand, manages to sell with just the petrol and CNG powertrains.

Both these are good products. But their pricing and the sub-10 lakh positioning of higher variants have a lot to do with the sales success. Both the Punch and Exter manage to appeal to people who are on the lookout for tiny SUVs that pack ample VFM.

Why Do People LOVE Micro SUVs So Much?

One reason is that the SUV body style is highly sought-after in the present times. This global trend has its Indian arm going strong as well. Next is the added practicality, usability and India-friendliness these vehicles bring to the table. An Exter is much more practical and comfortable than a Grand i10 NIOS, and a Punch is any day better than a Tiago!

The high footfalls aren’t limited to the micro-SUV space alone. The immediate price periphery of it- where the base variants of Brezza, Nexon etc stand, also enjoy great acceptance. There is, in fact, space for an all new segment of SUVs here. Multiple manufacturers seem to have realized this as well.

New Players Enter the Segment

The rapidly growing micro SUV segment and its immediate vicinity are attracting new entrants. Kia could soon launch a product into these spaces. They are also working on another small SUV for the Indian market which will sit between the Sonet and the Seltos. Maruti Suzuki is also reportedly working on a Punch rival. Hyundai could launch the Bayon-based SUV to rival the Suzuki Fronx. Finally we have Skoda with the Kylaq targetted at the Brezza. The lower variants of these could also potentially eat into the sales of top-spec micro SUVs.