Navigating Trends: Moderate Growth in Passenger Vehicle Sales Amid Shifting Consumer Preferences

Passenger vehicle sales are expected to grow moderately by 3-5% this fiscal year, impacted by a high-base effect from FY24, a shrinking order book, and subdued demand for entry-level variants. The utility vehicle segment, however, continues to thrive, accounting for over 55% of new PV sales.

Passenger vehicle sales are projected to see a moderate growth rate of 3-5% this financial year, largely due to the high-base effect of FY24, a shrinking order book, and subdued demand for entry-level variants, according to a report by CareEdge Ratings.

The report highlighted that after a remarkable 90% growth with 90,432 units sold in FY24, the electric car segment in passenger vehicles is expected to reach 1.30-1.50 lakh units in FY25, driven by improved penetration rates.

Utility vehicles continue to dominate, now representing over 55% of new PV sales and expected to increase further in the medium term. This sector has benefitted from consumer preferences for better design, innovative models, and enhanced features, along with lower interest rates and a post-pandemic desire for personal mobility.

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