Hyundai expects 8-10% H2 sales growth, aims to outpace PV industry

Automaker expects passenger vehicle industry to grow 5-6 per cent in H2; new mid-size SUV and sub-four-metre EV are expected to help it grow faster than the market

Hyundai Motor India (HMIL) said it expects domestic sales to grow by 8-10 per cent year-on-year (YoY) in the second half of 2026-27 (H2FY27). This is significantly faster than the 5-6 per cent Y-o-Y growth that HMIL Managing Director (MD) and Chief Executive Officer (CEO) Tarun Garg was expecting for the overall passenger vehicle (PV) industry, as the automaker prepares to launch two new models in high-demand segments.

 

Garg stated that he was expecting the industry to post 18-20 per cent growth in H1FY27, mainly on a low base. 

 

The H1 growth numbers for the PV industry would be misleading, as sales were weak in the April-September period last year, he told Business Standard on the margins of the 66th annual session of the Automotive Component Manufacturers Association of India (ACMA).   

 

 

Hyundai is also maintaining its 8-10 per cent export growth guidance for FY27 despite logistics disruptions in West Asia. Garg said demand remains strong, with pent-up demand in the region, while Central and South American markets have grown faster as Hyundai focused more on those markets during the disruption.

 

The government had announced sizeable goods and services tax (GST) rate cuts on September 22, 2025, which accelerated PV demand.  

Since there was a boom in sales in H2 FY26, the high base will ensure that the volume sales growth (in  per cent terms) in the H2FY27 would remain in the 5-6 per cent range, Garg explained. 

 

The PV industry's high growth in H1 will be averaged out by the comparatively slower growth expected in H2. However, for the full year FY27, the auto industry's volume sales growth would come to about 10-11 per cent Y-o-Y, he elaborated. HMIL also expects its own sales growth to be in the 10-11 per cent range for the entire FY27. 

Hyundai has already recorded around 12-12.5 per cent growth in domestic sales during April-August, Garg said. The company expects to sustain this momentum in H2.

 

Garg's optimism comes from the timing of Hyundai's new model cycle. It will launch a new mid-size SUV during the festival season and a dedicated electric vehicle (EV) in the sub-four metre segment. Both are segments that Hyundai sees as having high growth potential, allowing it to grow faster than the overall market even when industry growth moderates.

 

It is also expecting a strong festive season. Garg said Hyundai could see 10-15 per cent sequential growth during the period, while Y-o-Y growth could come close to double digits. 

 

Rural demand is another source of strength for Hyundai. Rural markets accounted for 25.9 per cent of Hyundai's sales in the first quarter of FY27, up from 22.6 per cent in the year-ago period.

 

Garg said weaker monsoon conditions and delayed Kharif sowing, have not yet affected Hyundai's rural demand as it continued to expand its rural network, with six out of every 10 new outlets being added in rural areas.

 

Hyundai's existing portfolio also showed broad-based improvement. Between April and August, Aura's Y-o-Y sales grew 13 per cent, Exter sales rose by 38 per cent, Venue’s sales were up 49 per cent, i20 up about 30 per cent and Grand i10 Nios sales rose by about 6 per cent. Garg said Exter and Venue were recording the strongest growth among Hyundai's models.

 

The shift towards sports utility vehicles (SUVs) remained a major factor shaping the market. Garg said hatchbacks were also recovering, but SUV growth remained faster. In the ~6-8 lakh price range, customers increasingly want a higher seating position, greater ground clearance and features such as a sunroof, making micro-SUVs and entry-level SUVs more attractive than traditional hatchbacks.

 

On production, Hyundai was bringing forward the third shift at its Pune plant by two years. Instead of starting in 2028, the third shift will begin from October 1. At Chennai, capacity utilisation had fallen to 70-75 per cent after some production shifted to Pune, but Garg expects it to return to around 90 per cent.

 

Hyundai currently has a production capacity of 994,000 vehicles, comprising 824,000 units at Chennai and 170,000 at Pune. Another 80,000 units are planned for 2028 and 70,000 units for 2030. Garg said the additional capacity would allow Hyundai to respond quickly if demand rises.

 

The upcoming Hyundai EV will also be PLI-compliant from day one. PLI, or production-linked incentive, scheme is a government scheme that rewards eligible manufacturers for meeting specified production and investment conditions. Garg said Hyundai's new EV is being developed specifically for India and will use technology, artificial intelligence (AI) and features aimed at improving the customer experience.

 

The new mid-size SUV, meanwhile, will be positioned away from the Creta to limit the risk of one Hyundai model crowding out sales from another. Garg said the company sees an opportunity in the 3.995-4.4 m length segment, where it can attract customers looking for technology and greater interaction with their vehicles.