India’s passenger vehicle market is witnessing a significant change in consumer preferences, with mid-size SUVs gaining ground as buyers increasingly choose larger, more spacious and feature-rich vehicles.

Mid-size SUVs and crossovers measuring more than four metres accounted for 18.2% of domestic passenger vehicle sales during the first quarter of FY27, according to estimates by Kotak Institutional Equities cited by The Economic Times. Their share stood at 15% a year earlier and 12.4% two years ago, highlighting the continuing shift towards larger vehicles.

The trend reflects broader premiumisation within India’s automotive market as consumers place greater emphasis on cabin space, luggage capacity, comfort, safety and technology.

Poonam Upadhyay, Director at Crisil Ratings, told The Economic Times that the movement indicates continuing premiumisation in the passenger vehicle market, with consumers increasingly choosing higher-value vehicles offering greater versatility and comfort. Rising household incomes and maturing vehicle ownership cycles are also encouraging customers to pay more for these benefits.

Automakers are responding by expanding their mid-size SUV portfolios. Hyundai Motor India Managing Director and CEO Tarun Garg said the company plans to introduce a new mid-size internal-combustion-engine SUV during the festive season. Hyundai already competes strongly in the segment with the Creta.

Meanwhile, compact SUVs have experienced some moderation in market share, while traditional hatchbacks continue to face pressure as customers migrate towards larger vehicles.

The changing preferences underline a wider transformation in one of the world’s major automobile markets, creating opportunities for manufacturers to compete through design, technology, safety and increasingly sophisticated product offerings.