Maruti, Hyundai, Toyota to Unleash New Wave of 7-Seater SUVs—Family Cars Get Bigger in 2024

Maruti Suzuki, Hyundai Motor India, and Toyota Kirloskar Motor are gearing up to launch more than seven new seven-seater vehicles over the next year. This move is in response to the growing demand for larger family cars, a trend that has increased since the pandemic.

Upcoming Launches: What to Expect

The first to hit the market will be the updated Hyundai Alcazar in early September. Following this, Maruti Suzuki and Toyota plan to launch seven-seater versions of their Grand Vitara and Hyryder SUVs in 2025.

Kia, another Korean automaker, is also expected to introduce a seven-seater electric vehicle based on its popular Carens model next year. Other upcoming releases include upgraded versions of MG Motor’s Gloster, Jeep’s Meridian, and Kia’s Carnival, all aimed at the more premium segment.

Shift from Small Cars to SUVs

The demand for smaller, entry-level cars has been declining in India, while sales of seven-seater SUVs, such as Mahindra XUV700, Mahindra Scorpio, and Tata Safari (priced between ₹15-25 lakh), have nearly tripled over the past three years. In 2023, sales of these models reached 335,208 units, prompting car manufacturers to accelerate their plans for this segment.

Current Market Offerings

Currently, there are about six models available in this category, including the Kia Carens, which offers a more affordable alternative to Toyota’s popular Innova and Innova Crysta.

Rising Premium Vehicle Sales

Senior industry executives have noted that the surge in premium vehicle sales over the last few years has led to a growing number of buyers upgrading from midsize SUVs to larger, feature-rich models. This trend, combined with the continued popularity of utility vehicles, rising disposable incomes among young buyers, and the growing demand for longer-term loans (seven years compared to five earlier), is driving more big-ticket purchases.

Longer Loan Terms for Bigger Cars

Shahrukh Todiwala, a director at Kotak Mahindra Prime, explained, “In the last 2-3 years, we have seen a significant increase in the preference for seven-year loan terms, which has risen 3-4 times from earlier levels. Buyers are choosing longer loans to afford bigger cars while keeping monthly payments the same. Additionally, there has been a 20% increase in the average ticket size across the industry, reflecting a shift towards larger SUVs.”

Impact on Domestic Sales

In FY24, vehicles priced above ₹10 lakh made up nearly half (47%) of all domestic passenger vehicle sales, up from 22% in FY21. In the first four months of this fiscal year, 63% of passenger vehicle sales were from larger utility vehicles, including SUVs and MPVs, compared to 50% in the same period last year.

Strategic Expansion in the SUV Segment

Satinder Bajwa, Chief Commercial Officer at JSW MG Motor India, said, “The SUV segment in India has grown rapidly, driven by the increasing preference for spacious and comfortable vehicles, especially for family travel and leisure. Our Hector and Gloster models have helped us capitalize on this trend. To keep up with changing market dynamics, MG is planning to expand its product lineup in this segment strategically.”

Kia’s Success with the Carens

Hardeep Singh Brar, Senior Vice-President of Marketing and Sales at Kia India, noted, “In the last quarter, the Carens accounted for 26% of our monthly domestic sales, and we are confident that its popularity will continue to grow. We recently noticed a strong demand for a six-seater option, which led us to refresh the Carens and introduce new trims to better meet the needs of families seeking a luxurious and comfortable mobility experience. We are excited to build on this momentum and remain focused on delivering exceptional value and innovation in this competitive segment.”

Evolving Consumer Preferences

A senior industry executive, speaking anonymously, added, “Customers are getting younger, with around 60% of new car buyers under 35 years old. Vehicles have become a means of self-expression. There is a growing preference for safety, environmental consciousness, and the latest smart features, along with a desire for a better driving experience and a premium look and feel. Demand for larger SUVs and top variants in each segment is on the rise.”