Tata Motors expects SUV share of overall sales to cross 70%: Shailesh Chandra

New Delhi: Tata Motors Passenger Vehicles expects the share of SUVs in its overall sales to exceed 70% as the company enters the mid-sized category with the Sierra, positioned as a premium model. The development was outlined by Managing Director and CEO Shailesh Chandra in an interaction with PTI.

Chandra said the broader industry’s SUV contribution is likely to stabilise between 55% and 60%, with GST 2.0 expected to support growth in non-SUV categories, although the extent of future momentum will depend on new model introductions in those segments.

The company is entering the mid-sized SUV market, currently led by Hyundai Creta, Kia Seltos and Maruti Suzuki Grand Vitara, with the reintroduced Sierra, offered at introductory prices starting at Rs 11.49 lakh across three engine variants, including two petrol and one diesel. An electric version is scheduled for launch in the next financial year.

"I believe that it can take us to 70% plus," Chandra said when asked how the Sierra could shape the company’s SUV share. He added that the current contribution is “around 65-70%.”

According to FADA data, the company’s overall retail sales in October stood at 75,352 units, up 13.52% from 66,903 units in the same month last year.

Chandra said compact and sub-compact SUVs saw a notable increase in volumes following GST 2.0. "Post GST 2.0, I think the compact SUV segment and sub-compact SUV segment really went up in volume significantly. Since we were the market leaders in this segment with Nexon and Punch kind of vehicles, it gave us the boost that we were waiting for," he said.

He added that the Sierra’s market entry could contribute to a “massive ramp up” in volumes. "With Sierra's strong value proposition, depending on how much volume we get, definitely it will mean a massive ramp up from where we were operating at 45,000 (units a month), I think we have done our homework."

Chandra also said the company intends to expand its presence to 80% of the passenger vehicle market from the current 55%. This will involve entry into new segments, broadening the product range and considering all-wheel-drive systems for future models, including the Sierra.

Reflecting on the decision to revive the Sierra brand, he said the company sought to reinterpret it for a younger customer base. "When we were reimagining this in its new avatar, we said, we have to build this fusion of originality by making it resemble what original Sierra stands for, but making it very modern, also to be relevant to Gen Y and Gen Z."

The company has positioned the Sierra in the mid-size segment, which Chandra described as a growing space due to its balance of footprint and interior room. The model features a three-screen infotainment system, 5G connectivity and level two-plus ADAS. These features, he said, are intended to appeal to younger consumers "who live a very digital life".

Bookings for the Sierra will start on December 16, with deliveries scheduled to begin on January 15, 2026.
Chandra said there had been a noticeable rise in sales of the Tiago and Altroz following GST reductions on hatchbacks, although the shift towards SUVs remained stronger than in other categories. "Yes, we did see a significant boost in volumes of Tiago as well as Altroz, but we saw bigger boost in compact SUV and subcompact SUV."

He added that the preference for SUVs continues to influence buying behaviour. "If there is, at the same price point an SUV option, people prefer that more and that is very clear."

Commenting on recent performance trends, Chandra noted growth of 5% and 17% in the domestic passenger vehicle market over the past two months. "This month also can be a double digit growth for the industry," he said.

He added that continued growth across the sector would create space for both SUVs and hatchbacks. "Therefore, if the industry keeps growing well, it creates space for both SUVs and hatches because post GST reduction, even hatches, MPVs and all have increased in volumes but since there are more launch activities in the SUV space, they should strengthen from where it is right now, at 55%."

Total passenger vehicle retail sales in October stood at 5,57,373 units, as per FADA data.