Rising Exports Offset Falling Local Sales For Indian Automakers In FY26: Report

While the domestic passenger car market faces headwinds, India's automobile manufacturers are finding new growth avenues through international markets, particularly for compact and small cars, says a report by Business Standard. The contrasting trends highlight the country's growing importance as a global manufacturing hub for compact cars.

Export Counters Domestic Slowdown

Recent industry data reveals a stark divergence between India's domestic and export car markets. According to the Society of Indian Automobile Manufacturers (SIAM), passenger car exports surged 8.5 per cent year-on-year during April-August of the current fiscal year, while domestic sales contracted by an equivalent 8.5 per cent.

Also read: Passenger Vehicle Sales Fall 9% YoY In August 2025: SIAM

This trend reflects changing consumer dynamics both at home and abroad, with international markets showing sustained appetite for India-manufactured compact vehicles.

Market Leaders Drive Exports

India's automotive giants are capitalising on this export opportunity. Maruti Suzuki India, the nation's largest car exporter, achieved remarkable 37 per cent growth in overall exports during the April-August period. Meanwhile, Hyundai Motor India recorded 12.45 per cent export growth during the same timeframe.

The passenger car segment specifically showed even stronger performance, with Maruti's exports in this category jumping 43 per cent. Hyundai also registered nearly 16 per cent growth in passenger car exports, demonstrating the robust international demand for Indian-made vehicles.

Interestingly, both companies faced declining domestic passenger car sales - Maruti saw a 6.4 per cent drop while Hyundai experienced a nearly 16 per cent decline in home market sales.

Compact Cars Lead Global Appeal

The export success story centres around compact vehicles under four meters in length. 

Rahul Bharti, Senior Executive Officer at Maruti Suzuki, was quoted as saying: "Interestingly, if you notice, all our top five export models are less than four metres. So, it is clear that globally customers prefer compact cars and have a strong acceptance for small cars. Customers understand that small cars have a lower impact on the environment and help reduce road congestion."

Maruti's leading export models for FY26 include the Fronx, Jimny, Swift, Baleno, and Dzire, with primary destinations being Japan, the Middle East, Africa, and Latin America.

Strategic Markets Show Strong Performance

Latin American and African markets have emerged as key growth drivers for Indian small car exports. 

Tarun Garg, Whole-time Director and COO at Hyundai Motor India, highlighted their success: "Our small cars, particularly the i10 NIOS, have been performing very well in markets like South Africa, Mexico and Chile, where customers value Hyundai's advanced features, quality and premium design that appeal to both fleet and retail segments."