Decoding India's UV

How utility vehicles came to dominate the Indian market and why the trend is here to stay.

- Rishi Kant

MAHINDRA AND MAHINDRA (M&M) made headlines in July 2022 when it announced 25,000 Scorpio N bookings within a minute of opening online applications. The number reached over 1,00,000 in 30 minutes with the rush even triggering a brief technical glitch in the payment gateway provider. This meant an unprecedented waiting period of up to 20 months. "In August, we manufactured around 6,000 units. We have released the waiting period for the first 25,000 units, but if you get 1,00,000 bookings for a car that you are able to make only 6,000 units in a month, the waiting period will be substantial," says Rajesh Jejurikar, executive director, auto and farm sectors, M&M.

M&M's struggles epitomise the mad rush for utility vehicles (UVS), predominantly sports utility vehicles (SUVs), in India's passenger vehicle market. In FY22, about 14.89 lakh UVs, including SUVs and multi-purpose vehicles (MPVs), were sold in India compared with 14.67 lakh sedans and hatchbacks, according to data from Society of Indian Automobile Manufacturers. In FY19, 9.41 lakh UVs were sold compared to 22.18 lakh hatchbacks and sedans. This may be startling for the average joe who perceives India as a price and fuel-efficiency-sensitive market which loves small cars, but a large number of carmakers saw the trend coming. Some struck when the iron was hot and have reaped benefits in the form of enhanced market share. "About a decade ago, market share of UVs was 15-18% (it is 55% now), and UVS were rugged, to be used on rough terrains," says Jejurikar. Advent of crossovers, which are fuel-efficient and lighter, played a vital role in increasing their acceptance, he says. Globally, share of UVs was around 45% in 2021.