Maruti Suzuki Q1 Results: Exports Drive Through, Small Car Sales Dip 37%

Maruti Suzuki India, the country's leading domestic automaker, had a subdued financial performance during the first quarter of FY2025-26. For the April–June quarter, the company recorded a total sales volume of 527,861 units, which was a year-on-year growth of just 1.1 per cent. This slight upturn was driven principally by resilient export performance, even though domestic sales declined by 4.5 per cent.

Also Read: Maruti Suzuki Serviced 24.5 Lakh Vehicles In May ‘25; Sets New Record

The big highlight of the quarter, though, was a 37.4 per cent increase in exports that offset the sequential fall in domestic volumes. Maruti Suzuki shipped 96,972 units abroad during the quarter while domestic sales fell to 430,889 units. The fall in domestic sales is a reflection of the softening demand scenario, especially in the mass segments where Maruti Suzuki has been dominant in the past. 

Also Read: Maruti Suzuki Set for Major Launch on September 3 – Is It the New Escudo SUV or e-Vitara EV?

Topline Growth Amid Margin Pressure

The net sales of Maruti Suzuki increased 8.1 per cent year on year at ₹36,624.7 crore due to a better product mix, better realisations and overseas market growth. But the profitability is a more complex tale. Operating profit before interest and tax (EBIT) decreased by a close to 19 per cent from the year-earlier same quarter to ₹3,057.8 crore.

This narrowing was primarily the consequence of higher material and employee costs, which rose 220 and 20 basis points, respectively, as a percentage of net sales. Net profit edged up by 1.7 per cent to ₹3,711.7 crore, as profits were supported by higher non-operating income. But the fact that the operating margin fell to 8.3 per cent from 11.1 per cent a year ago suggests the company is under pressure to stay profitable in a price-sensitive competitive market.

Also Read: Made-in-India Maruti Suzuki Fronx Hits 1 Lakh Exports in 25 Months

Segment-Wise Story: The Winners and Losers

In the entry-level and hatchback segments, which have budget players like the Alto and Swift, saw a sharp 10.6 per cent year-on-year decline. The compact segment took a big hit with a decline of 36.6 per cent, suggesting a weakening consumer appetite in the budget segment. The numbers point to an ominous trend: first-time and rural car buyers may be going slow, perhaps due to high vehicle prices and tension caused by inflation.

Also Read: Maruti Suzuki Grand Vitara Crosses 3 Lakh Sales Milestone In 32 Months

On the other hand, SUVs like Brezza, Grand Vitara, and Fronx held their ground with a modest 0.8 per cent decline, comfortably outperforming the hatchback or small car segment. SUVs accounted for 37.6 per cent of domestic sales, reiterating the consumer shift towards larger and feature-packed cars.

Light commercial vehicle (LCV) sales, while a small piece of the puzzle, grew by 7.1 per cent, suggesting resilience in demand for commercial use, likely fuelled by MSME and e-commerce-related transportation needs. 

Why This Matters?

For Indian car buyers, particularly those in the entry-level and compact car segments, Maruti’s Q1 performance may foreshadow tighter incentives and slower product refreshes. While expenses increase and margins become tighter, manufacturers will more than likely target more high-margin UVs rather than low-cost vehicles, hence possibly affecting the affordability and availability of low-cost cars. 

Also Read: Maruti Suzuki Jimny Crosses 1 Lakh Sales Milestone in Two Years, Driven by Export Demand

On the other hand, consistent export performance as well as product proliferation can allow Maruti to invest in newer technologies, safety features, and hybrid products, which will cascade benefits to the buyer in the medium term. 

Looking Ahead

The increasing emphasis on SUVs by the company also implies that customers searching for value in the ₹10-20 lakh segment can anticipate more sophisticated products with improved features, as Maruti fights it out in a market becoming increasingly crowded with international players. To this end, the Indian automaker is set to sharpen its product portfolio with various launches that would help turn around local traction over the next quarters.

Also Read: Maruti Suzuki Exports Over 3 Lakh Vehicles In FY 2024-25

But the most anticipated are the Maruti e Vitara, and the launch of the Escudo (launch in India on September 3), an SUV that will be positioned between the Brezza and the Grand Vitara in the company's SUV lineup. Also on the cards is a 7-seater version of the Grand Vitara, which is said to directly target families looking for a three-row SUV offering from a manufacturer with an established pedigree.