India Passenger Vehicles Market 2024–2033

Reports Description

India Passenger Vehicles Market was valued at USD 65.3 Billion in 2024 and is expected to reach USD 133.8 Billion by 2033, at a CAGR of 9.6% during the forecast period 2024 – 2033.

A motor vehicle that is mainly used to transport people instead of products or cargo is called a passenger vehicle. Passenger cars are outfitted with amenities, safety measures, and seating configurations that are designed to make passengers’ journeys more comfortable and convenient.

India Passenger Vehicles: Growth Factors

Demand for compact size, aesthetic look and affordability

Compact size, fashionable design, and affordability are key factors that propel the market for passenger vehicles. Urban residents looking for convenient parking alternatives and mobility in crowded metropolitan situations are drawn to compact sizes.

Attractive design has a major role in drawing customers since aesthetics affect the items. Furthermore, economic value appeals to growing countries and consumers on a tight budget since it is affordable, fuel-efficient, and requires little maintenance.

In addition to improving passenger cars’ overall appeal, these features also take care of practical problems like usability and pricing, meeting the demands and tastes of a broad spectrum of customers.

As an outcome, in the cutthroat automobile industry, cars that combine small size, fashionable design, and affordable price are in more demand and have greater market success.  For instance, the Hyundai Grand i10 Nios is a compact hatchback that is well-known for its spacious cabin, comfortable ride, and modern amenities.

It is an improved model of the well-liked Hyundai Grand i10, which was introduced in India in 2020. The gorgeous, affordably priced Renault Kwid is a medium-sized vehicle with styling inspirations from SUVs. It has features including a computerized instrument panel and an airbag on the driver’s side. It has a large interior, excellent ground clearance, and an infotainment touchscreen.

Rising popularity of electric vehicle

Concerns about global warming and the preservation of the environment are pushing customers toward greener forms of transportation, such as electric vehicles (EVs), which emit fewer greenhouse gases than conventional cars with combustion engines.

Furthermore, EV performance, cost, and range have all improved as a result of advances in battery technology, which makes them more appealing to a wider variety of consumers. Moreover, tax breaks, incentives, and emissions limits are laws and policies that the government is using to encourage the use of electric cars.

In addition, as EV charging station infrastructure grows and automakers offer more electric car models, the popularity of EVs rises, making them a practical and affordable choice for daily transportation requirements.

Altogether, these elements working together are propelling notable expansion in the passenger vehicle market towards electric vehicles. For instance, Tata Motors accounted for 72% of the domestic EV market in 2023, next to MG Motors (10.8%) and Mahindra (9%).

The best-selling models were the Tata the MG ZS, Motors Tiago, Nexon, and Tigor, and the Mahindra XUV400. Robotic and automated industrial equipment for shipping and handling of products, installation, painting, and quality control are installed at EV production facilities located in India.

India Passenger Vehicles: Restraints

High cost and supply chain disruption

High production expenses result in higher car prices, which lower accessibility and decrease buyer demand. These costs are influenced by several variables, including labour expenses, costs of raw materials, and compliance with regulations. Disruptions to the supply chain, such as delays in logistics or shortages of essential parts, can also affect production schedules and car availability, which increases pricing pressure and affects sales.

These difficulties not only affect manufacturers but also auto dealers, suppliers, and customers, clouding the market and preventing expansion. Moreover, supply chain interruptions have become more severe in the context of international events like the COVID-19 epidemic, and Russia Russia-Ukrainian War demonstrating the passenger car market’s susceptibility to outside shocks and emphasizing the necessity of resilience and adaptation amid such difficulties.

India Passenger Vehicles: Opportunities

Integration of IoT and ADAS

The blending of Internet of Things (IoT) technology with Advanced Driver Assistance Systems (ADAS) has transformed the passenger vehicle business by improving security, comfort, and connectivity. More precise and flexible driver assistance features are made possible by the Internet of Things, which makes it possible for ADAS-equipped cars to gather and send real-time data from many cameras, sensors, and linked devices.

IoT-enabled ADAS systems, for instance, can give proactive breakdown warnings, automated cruise control, and lane keeping assistance by analyzing traffic patterns, highway conditions, and vehicle performance data. IoT connectivity also makes it possible for mobile devices and smart home systems to integrate seamlessly, giving drivers the ability to remotely monitor and manage their cars, access navigational aids, and get tailored suggestions.

In general, the combination of ADAS and IoT technology enhances not just driving enjoyment and safety but also transforms the passenger vehicle market by offering innovative features and personalized experiences to consumers.

For instance, Summit on Connected Vehicles 2022 India’s rate of adoption of connected cars is lower than that of the rest of the world market (43%), at 17%. But the nation is also getting ready to move toward intelligent electric mobility while putting more of an emphasis on domestic production. These kinds of gatherings will assist Indian ecosystem participants in staying abreast of global developments and equipping themselves for the impending shift.

During this session, representatives from the 5G Automotive Association, Tata Elxsi, and Dell, talked about the need for C-V2X technology to improve communication, the potential that linked mobility presents for ecosystem players, the transition from a hardware-centric to a software-centric approach, and a novel mapping solution.

India Passenger Vehicles: Segmentation Analysis

India Passenger Vehicles market is segmented by vehicle type, propulsion type, end user and region.  Based on vehicle type, the market is classified into hatchback, sedan, SUV, MUV and others. Hatchback dominated the market in 2023 with a market share of 42.2% and is expected to keep its dominance during the forecast period 2024-2033.

Hatchbacks are ideal for urban settings with limited room for parking and mobility because of their rear door’s ability to open upward, granting access to the cargo area.

Furthermore, hatchbacks frequently have a large interior despite their small size, which allows for room for freight or baggage as well as comfortable seats for passengers. Budget-conscious buyers find hatchbacks appealing due to their lower price point and superior fuel economy when compared to bigger cars.

Additionally, hatchbacks are popular in the market for passenger cars because they appeal to a variety of groups, such as young adults, working families, and city dwellers. In general, hatchbacks are a popular option for daily commutes and urban transportation needs because they provide a blend of usefulness, cost, and efficiency.

Based on propulsion type, the market is classified into internal combustion engines, electric and hybrid. Cloud dominated the market in 2023 with a market share of 46.8% and is expected to keep its dominance during the forecast period 2024-2033. ICE-powered cars produce mechanical power which powers the wheels by burning fuel, usually gasoline or diesel, within the engine.

Due to its adaptability, ICEs may be used in a variety of configurations to fit a range of vehicle types, including trucks, SUVs, and small automobiles. As ICEs have an existing infrastructure, a large driving range, and quick refilling capabilities, vehicles continue to dominate the market despite developments in alternative engine technologies like electric and hybrid cars.

Furthermore, ongoing advancements in ICE efficiency and emissions control technology have lessened environmental issues related to the burning of fossil fuels, guaranteeing their continued use in the passenger car industry for the foreseeable future.

Based on end user, the market is classified into personal and commercial. Large enterprises dominated the market in 2023 with a market share of 75.8% and are expected to keep their dominance during the forecast period 2024-2033. Individual mobility demands and preferences are the primary drivers of the passenger car market, which is driven by personal use.

Demand for personal automobiles is driven by the need for independence, convenience, and mobility especially in locations with sparse public transit systems or large, open cities.  Furthermore, more people are owning passenger cars for personal usage due to reasons including bettering economic conditions, increasing financial resources, and changing lifestyles.

Moreover, the appealing prospect of owning a personal car is increased by technological and vehicle feature developments that meet the varied wants and tastes of users.

Report Scope

India Passenger Vehicles: Regional Analysis

Passenger Vehicles market is segmented into South India, North India, West India and East India. West India dominated the India Passenger Vehicles market in 2023 with a market share of 48.2% and is expected to keep its dominance during the forecast period 2024-2033.

The growing middle class and higher levels of disposable money have been brought about by the region’s rapidly urbanizing population, improved economic climate, and expanding population, which has raised the demand for passenger cars. Major automobile manufacturing hubs, such as Maharashtra and Gujarat, are also located in West India and draw investments from both domestic and foreign automakers.

Moreover, the region’s passenger car industry is expanding as a result of supportive government policies, remuneration and initiatives to build infrastructure. Furthermore, West India’s position as a major participant in the passenger car industry is further strengthened by the existence of important automotive clusters, research facilities, and skilled labour, all of which promote innovation, efficiency in production, and market dominance.

India Passenger Vehicles: Recent Developments

• In January 2024, Tata Electric Mobility Ltd, an affiliate of Tata Motors, disclosed the official debut of its first passenger car from the Sanand factory.

• In February 2024, Mahindra & Mahindra developed three pure EV utility vehicles. They foresee a significant market for electric SUVs and UVs and are exploring alternative fuels.

• In September 2023, Honda Cars India Limited, the largest producer of high-end vehicles in India, announced the official launch of its latest SUV, the Honda Elevate.

List of the prominent players in the India Passenger Vehicles Market:

• Maruti Suzuki India Limited
• Hyundai Motor India Limited
• Tata Motors Limited
• Mahindra & Mahindra Limited
• Kia Motors India
• Toyota Kirloskar Motor Private Limited
• Honda Cars India Limited
• Ford India Private Limited
• Volkswagen India Private Limited
• Renault India Private Limited
• Nissan Motor India Private Limited
• MG Motor India
• Skoda Auto India Private Limited
• BMW India Private Limited
• Mercedes-Benz India Private Limited
• Audi India
• Jeep India
• Volvo Cars India Private Limited
• Jaguar Land Rover India
• Force Motors Limited
• Others

These key players are adopting various growth strategies such as mergers & acquisitions, joint ventures, expansion, strategic alliances, new product launches, etc. to enhance their business operations and revenues.

The India Passenger Vehicles Market is segmented as follows:

By Vehicle Type

• Hatchback
• Sedan
• SUV
• MUV
• Others

By Propulsion Type

• Internal Combustion Engine
• Electric
• Hybrid

By End User

• Personal
• Commercial