The seven-seater midsize SUV space is shrinking. In CY2017, this segment had four models (Mahindra XUV 500 and Scorpio, and Tata Hexa and Safari), with sales of 96,539 units. In the CY2020 pandemic year, the segment had shrunk to 43,678 units (despite the addition of MG Hector Plus). However, analysts are of the opinion that this segment will pick up in a big way this year, with Tata Motors having launched the new Safari earlier this year, followed by Hyundai Alcazar (later this month) and Mahindra XUV 700 (later this year).
Tarun Garg, director, sales & marketing, Hyundai Motor India, said that even though this segment is shrinking, the decision to enter this space is well-thought-through. “One of the previous decade’s most successful cars has been the Creta (of which over 6 lakh units have been sold since 2015), and with the Alcazar we want to tap into the existing Creta customer base who may wish to upgrade,” he said. “We have always believed that great products create and expand segments. The Santro did that in 1998-99, as did the i10 and the i20 in the 2010s, and then in 2015 the Creta. These cars either created segments or expanded existing segments.”
Since the launch of the Creta in 2015, the sales share of SUVs has taken off. “In 2015, SUVs formed just 13.5% of the overall passenger vehicle market, but in the January to March 2021 quarter, this share has shot up to 34%,” Garg added. “I believe Hyundai has a big role to play in expanding this share. The Alcazar will not only complete our range of SUVs, but our market research suggests that customers are really looking for SUVs this shape and size.”
Analysts agree that the next big SUV segment in India is the midsize seven-seater SUVs.
Som Kapoor, partner, Automotive Sector, EY India, said that mid-size seven-seat SUVs are the new frontier. “There are a lot of families in India that have two parents and two kids, plus a driver, and they are keenly looking at the midsize seven-seater SUVs,” he said.
Gaurav Vangaal, associate director, IHS Markit, added that with bigger players such as Hyundai entering this space (and the Safari off to a flying start), it will expand. The Alcazar, for example, has six and seven seat options, and is expected to attract customers from sedans and MPVs, as well as those who wish to upgrade from the Creta. “Next year it’s likely that Maruti Suzuki will enter the midsize six- and seven-seat SUV space (and a co-badged product with Toyota), and that will really open it up,” Vangaal said.
Garg added that customers from all segments are shifting to SUVs as their next car, and the same with happen with the Alcazar. “I think a lot of customers will come from the midsize sedan segment, and then there would be upgraders from the Creta segment. The Alcazar will not only meet their mobility needs, but also their lifestyle needs,” he said.
The Alcazar will be slotted between the Creta and the Tucson (the Creta is priced, ex-showroom, from Rs 9.99 lakh to Rs 17.54 lakh, and the Tucson from Rs 22.55 lakh to Rs 27.33 lakh). It will have two engine options: the 2.0-litre petrol (157bhp) and the 1.5-litre diesel (113bhp), and both the engines will be offered with 6-speed automatic and 6-speed manual transmission options.
Midsize 7-seat SUV sales
Model CY2017 CY2018 CY2019 CY2020
Mahindra XUV500 26,626 25,341 17,175 7,053
Mahindra Scorpio 52,103 49,063 46,725 31,240
Tata Hexa 13,502 9,764 2,917 198
Tata Safari 4,308 6,138 2,432 –
MG Hector Plus – – – 5,187
Total 96,539 90,306 69,249 43,678
Source: Company data
