India’s Four-Wheeler Sales Report – December 2025: A Strong Year-End Performance

The Indian four-wheeler market closed December 2025 on a high note, reinforcing the long-term structural strength of the country’s passenger vehicle (PV) industry. After navigating multiple headwinds over the past few years—including supply-chain disruptions, inflationary pressures, and rising interest rates—the sector demonstrated resilience and maturity. December 2025 emerged as a defining month, supported by year-end buying sentiment, policy tailwinds, and sustained preference for personal mobility across urban and semi-urban India.

Passenger vehicles, comprising hatchbacks, sedans, SUVs, MPVs, and electric cars, recorded healthy growth compared to December 2024. Automakers leveraged festive spillover demand, aggressive dealer-level discounts, and strong order backlogs to push deliveries before the calendar year-end. As a result, December became one of the strongest months of CY2025 for the Indian four-wheeler industry.

Overall Market Overview

Industry data indicates that India’s passenger vehicle market witnessed robust year-on-year growth in December 2025, with cumulative monthly volumes running into several lakh units. While individual manufacturers report their own dispatch numbers, the broader trend was clear: demand remained strong across segments, especially SUVs and compact cars.

Two major structural factors underpinned this performance. First, earlier GST rationalisation on cars and SUVs improved affordability, particularly in the mass and mid-size segments. Second, consumer confidence remained buoyant, driven by steady employment conditions, urban income stability, and improving rural sentiment after a reasonably good monsoon season.

Performance of Major Automakers

Market leader Maruti Suzuki India delivered a standout performance in December 2025. The company reported total sales exceeding 2.1 lakh units, including domestic sales and exports. Domestic passenger vehicle volumes reached record monthly levels, reflecting strong demand across hatchbacks, sedans, SUVs, and MPVs. Popular models such as Baleno, Dzire, Brezza, Ertiga, and Grand Vitara continued to anchor Maruti’s dominance by catering to a wide range of budgets and use cases.

Mahindra & Mahindra further strengthened its position as India’s leading SUV-focused automaker. December 2025 saw Mahindra record strong sales driven largely by its utility vehicle portfolio. Models like Thar, Scorpio, Bolero, and the newer compact SUVs continued to enjoy waiting periods, underscoring sustained consumer appetite for rugged, lifestyle-oriented vehicles. Mahindra’s consistent performance also reflected a broader industry trend: SUVs are no longer niche products but the core growth engine of the Indian PV market.

Tata Motors reported steady growth in December 2025, supported by its diversified passenger vehicle lineup. The company benefited from strong demand for compact cars and SUVs such as Punch, Nexon, and Tiago. Additionally, Tata Motors maintained leadership in the electric passenger vehicle space, with EV models contributing meaningfully to overall volumes. The company’s focus on safety ratings, design refreshes, and value positioning resonated well with Indian buyers.

Hyundai Motor India posted moderate but stable growth during the month. Hyundai’s December sales were supported by consistent demand for compact SUVs and premium hatchbacks. Exports also played an important role, reinforcing India’s position as a global manufacturing hub for the company. Hyundai’s balanced approach—serving both domestic and export markets—helped cushion volatility in individual segments.

Meanwhile, Toyota Kirloskar Motor delivered one of its strongest December performances in recent years. Rising acceptance of hybrid technology, coupled with strong sales of MPVs and SUVs, enabled Toyota to post impressive year-on-year growth. The company’s emphasis on fuel efficiency and reliability continued to attract family-oriented buyers.

Segment-Wise Market Trends

SUVs remained the undisputed growth driver of India’s four-wheeler market in December 2025. Compact and mid-size SUVs accounted for a growing share of total PV sales, reflecting changing consumer preferences toward higher ground clearance, road presence, and perceived safety. This shift has fundamentally reshaped automaker portfolios over the past few years, and December 2025 reaffirmed this transformation.

Hatchbacks and compact cars, which had seen muted demand earlier, showed signs of revival. Improved affordability following tax adjustments and targeted discounting brought entry-level buyers back to showrooms. This was particularly evident in urban and tier-2 markets, where first-time buyers re-emerged as a significant customer segment.

Sedans continued to play a relatively smaller role but retained a loyal customer base, especially among fleet operators and buyers seeking comfort-oriented vehicles. MPVs remained steady, driven by family usage and inter-city travel demand.

Electric Passenger Vehicles

Electric cars, while still forming a small share of total four-wheeler sales, continued their gradual upward trajectory in December 2025. Improved charging infrastructure, higher fuel prices, and growing awareness of total cost of ownership supported EV adoption. Tata Motors led this segment, while other manufacturers expanded their EV portfolios cautiously. December’s data suggests that EV growth is steady rather than explosive, indicating a long-term transition rather than a sudden disruption.

Urban and Rural Demand Dynamics

Urban India remained the primary driver of passenger vehicle demand in December 2025. Replacement demand, lifestyle upgrades, and corporate purchases supported sales in metro and tier-1 cities. Year-end bonuses and promotional schemes further encouraged buyers to advance purchase decisions.

Rural demand showed incremental improvement, supported by stable agricultural income and government spending. While rural car penetration remains lower than urban markets, December indicated a gradual broadening of the demand base beyond cities.

Export Contribution

Exports continued to be a vital pillar of the Indian four-wheeler industry. Several manufacturers leveraged India’s cost-efficient manufacturing ecosystem to supply vehicles to global markets. This export strength provided an additional buffer against domestic demand fluctuations and reinforced India’s role in global automotive supply chains.

Challenges Ahead

Despite the strong December performance, the industry faces ongoing challenges. Rising compliance costs due to stricter safety and emission norms, potential volatility in fuel prices, and interest rate uncertainties could impact affordability in 2026. Competition is also intensifying, particularly in the SUV and EV segments, which may pressure margins.

Outlook for 2026

The momentum witnessed in December 2025 positions the Indian four-wheeler industry well for 2026. Continued SUV demand, gradual EV adoption, and stable macroeconomic conditions could support sustained growth. Manufacturers that balance affordability, innovation, and after-sales support are likely to emerge stronger in the evolving market landscape.

Conclusion

December 2025 marked a confident close to the year for India’s four-wheeler industry. With strong performances across major automakers and segments, the month highlighted the sector’s resilience and adaptability. As consumer preferences evolve and mobility needs expand, the Indian passenger vehicle market appears well-poised for steady, long-term growth.

---