From Suzuki to Volkswagen, global auto giants bet big on India as sales slow elsewhere

This trend highlights India’s increasing importance in the global automotive landscape.

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Two of the world’s largest carmakers are betting big on growing sales in India amid global geopolitical uncertainties. Japanese automaker Suzuki Motor Corp recently raised its production forecast for the ongoing fiscal year to 3.52 million units, banking on increasing sales in India, its largest market, after the GST rate revision last September. South Korea’s Hyundai Motor projects its sales growth in the Indian subcontinent to be the fastest globally in 2026. These Asian automakers, as well as their European rivals like Renault and Volkswagen Group, are upbeat about opportunities in India as both a market, now the world’s third largest with significant room for growth, and a manufacturing hub for exports.As much as 92.5 per cent of the 67,000-unit incremental production that Suzuki projects this quarter is in Asia, where Indian subsidiary Maruti Suzuki operates four factories with a combined annual capacity of 2.6 million units. The country accounts for 56 per cent of Suzuki‘s global sales and about 65 per cent of production.”We have seen sales increase for models across our portfolio post GST cut,” said Partho Banerjee, senior executive officer (marketing and sales) at Maruti Suzuki, the Indian market leader. Demand is so strong that the company’s production teams are working overtime, he said. “In January alone, we ran our plants on two Sundays and also on a holiday for Vasant Panchami.” Rate cuts by the Reserve Bank of India that made car loans cheaper, and the income tax reset announced in the budget last year are also contributing to demand, Banerjee said.Suzuki’s sales in India grew 3.8 per cent to 1.35 million units in the first nine months of this fiscal year, while those in Europe dropped 18 per cent to 135,000 units. Sales in Asia excluding India and AMEO/LatAm (Africa, the Middle East Oceania and Latin America) grew faster, but on a low base. Besides India and Japan, Suzuki in Asia also has facilities in Thailand, which it has agreed to sell to Ford in January, and Vietnam.

Rising India market share

Besides India and Japan, Suzuki in Asia also has facilities in Thailand, which it has agreed to sell to Ford in January, and Vietnam.Rival Hyundai, which expects global sales to expand by a modest 0.5 per cent to 4.16 million units in the ongoing calendar year, projects India to grow at 3.1 per cent. In a recent presentation to investors, it projected sales growth to be 0.5 per cent in the US, 1.8 per cent in Korea and flat in Europe.For Hyundai, India is the third largest market outside of its home base, after the US and Europe, with an about 14 per cent share in its international sales.January sales were the highest on record for Hyundai Motor India.

“If January is any indication, I think we are in for a very strong run,” managing director Tarun Garg said in a recent interaction.

“Many companies are reporting strong growth,” he said, citing rising experts as well as strong local demand from both urban and rural markets. “We are seeing this kind of positive momentum after a long time.”

Among other foreign automakers, Renault, which bought out the 51 per cent stake from alliance partner Nissan in the India manufacturing unit, said India is a “key pillar” in its global growth plans.

The company expects 50 per cent of its growth to come from markets in India and Brazil in the next three years, CEO Fabrice Cambolive recently told ET.

The company is looking to introduce multiple new products, including several SUVs, to increase its share of sales in the India market to 3-5 per cent by the turn of the decade, Cambolive said.