“The first eight months of 2025 have been a decline for the (passenger car) sector, while post-GST (reforms), there has been a growth of over 20 per cent. Even December was very strong. I hope January will be even stronger. So we see these growth rates continuing at double digits for four or five months,” he said.
Chandra further said, “Even if things stabilize a bit going forward, I am quite optimistic that the sector has the capacity to grow at double digits, 10 percent plus minus two…” He was responding to a question on the 2026 outlook for passenger car sales in India.
When asked about the growth prospects for Tata Motors Passenger Vehicles in 2026, Chandra said, “As far as Tata Motors is concerned, this is an intense (product) launch calendar (year) for us. I believe we will achieve industry-beating growth.”
Elaborating on the company’s optimistic outlook, he said deliveries will start this month for at least three products, including the new Punch, Sierra, as well as Safari and Harrier petrol. “Then there will be a slew of launches in this calendar year, so we would have strong growth that will outpace the industry,” Chandra claimed, adding, “After ranking number two in the third quarter of this financial year (in the last quarter of calendar year 2025), we have become number two in VAHAN. So, we have come out of 2025 well.”
Commenting on the demand trends in the PV market, he said that SUVs have continued to outpace cars post GST 2.0. Many SUV sub-segments are doing well, including the mid-size SUV, compact SUV and sub-compact SUV segments, and these have fueled the growth of the PV industry.
“So all three cylinders in the SUV segment are doing well,” Chandra said, adding that the segment in which Punch operates would also see accelerated growth.
“This product (the new Punch) will have the potential to definitely improve our sales and expand the pie for the sub-compact SUV segment,” he said, adding that the sub-compact SUV segment has been the biggest beneficiary of GST 2.0.
“Post GST 2.0, this segment has rebounded significantly with the kind of price reductions that occurred due to 10 percent GST cut. Therefore, growth in the segment has returned tremendously, to the extent of nearly 70 to 80 percent in Punch’s sales. Whereas before GST (cut), this segment and the entire entry-level segment declined more than the industry average decline,” notes Chandra.
The subcompact SUV segment, in which Punch competes with Hyundai Exter and Skoda Kylaq, among others, currently has cumulative monthly sales of approximately 40,000 units.
“This segment has the potential to continue growing… At one point it would have been 20,000 (units per month), which went up to 30,000 and now 40,000. I clearly see that on one hand the sector will grow faster than what we had seen last year,” he said, when asked if the subcompact SUV segment can reach a total of 50,000 units per month.
With the new Punch coming with a strengthened value proposition, freshness and contemporaryness, along with more powertrain options, Chandra expressed confidence that the models “will be a winner in the market”.
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