India's Auto Industry Sees 19% Growth In FY24 Fueled by SUV Popularity: Report

In 2023, the global auto industry saw a 12 per cent increase in vehicle sales. Meanwhile, India's UV and SUV segment grew in FY24, with volume rising by 23 per cent and value by 39 per cent

The Indian automobile industry experienced a 19 per cent increase in value during the financial year 2023-24 compared to the previous year, driven by rising purchases of utility vehicles (UVs) and sport utility vehicles (SUVs), states a report on Wednesday.

This surge in sales has propelled India to become the world’s third-largest automobile market based on vehicle registrations, trailing only China and the United States, as detailed in the 'India Automobile Value Report – II' by consultancy firm Primus Partners. Despite these developments, the average vehicle prices in India continue to remain comparatively lower than those in more developed economies.

In 2023, the global auto industry saw a 12 per cent increase in vehicle sales. Meanwhile, India's UV and SUV segment experienced robust growth in FY24, with volume rising by 23 per cent and value by 39 per cent. This surge was fueled by consumer preferences shifting towards higher segment vehicles, hybrid powertrains, automatic gear systems, and premium features like sunroofs. As a result of these trends, there was a notable 16 per cent rise in the average price of UVs and SUVs in the Indian market.

Anurag Singh, managing director at Primus Partners, said, “India’s automobile industry is growing faster in value compared to the number of units produced. This is because customers are preferring higher quality and higher feature vehicles.”

The passenger vehicles (PV) segment saw a 9 per cent decline in volume, coupled with a 5 per cent rise in prices, resulting in a 4 per cent decrease in overall PV value. In contrast, the two-wheeler (2W) segment reported a 10 per cent increase in volume alongside a 3 per cent price hike, leading to a 13 per cent growth in segment value.

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