Small cars return to fast lane as first-time buyers power auto surg

4 min readNew DelhiJul 27, 2026 06:10 AM IST First-time buyers accounted for 51% of its sales in the fourth quarter of FY26, up from 42% in the first half. (File Photo) India’s automobile market has delivered an unexpected upshift against a gloomy backdrop of elevated fuel prices, uncertainty over the monsoon and concerns among motorists about the ethanol-blending mandate. Overall vehicle retail sales rose almost 22% to a record 2.6 million units in June 2026, while passenger vehicle sales jumped 29% year-on-year to about 410,000 units, the highest recorded for the month.Within that surge is another surprise: the return of the first-time car buyer, and with it, a revival in small cars that many in the industry believed had been permanently beaten back by the rise of sport utility vehicles.