Tata Motors: Why Does It Fall Behind Maruti Suzuki and Hyundai Motors in Exports?

Synopsis: India’s PV export market is highly concentrated, led by Maruti Suzuki and Hyundai, while Tata Motors lags due to geopolitical disruptions and logistics issues. Rising costs and fuel volatility further challenge exports, pushing focus toward domestic demand and EV growth.

India is experiencing a significant consolidation in its passenger vehicle (PV) export market. In FY26, the two leading global car manufacturers, Maruti Suzuki India and Hyundai Motor India, dominated the sector by accounting for 70.03% of the total 905,200 units exported. This represents a notable increase from FY25, when their combined share stood at 64.05%, according to data from the Society of Indian Automobile Manufacturers.

The dominance of foreign players becomes even more apparent when including Nissan India, the country’s third-largest PV exporter. Together, these three companies accounted for 80% of total exports in FY26, up from 73% the previous year. This concentration highlights a growing gap between international manufacturers and domestic firms in the global market.

India’s leading homegrown manufacturers are struggling to keep pace in the export arena. Tata Motors and Mahindra & Mahindra combined for just a 3.2% share of total PV exports in FY26, illustrating a striking disparity between the global reach of foreign-owned entities and domestic brands.  

Geopolitical and Logistical Blockades in West Asia

The ongoing West Asia conflict has caused a severe disruption in Tata Motors‘ export operations, bringing shipments to the Middle East to a near standstill. Managing Director Girish Wagh noted that this isn’t just a drop in demand but a total logistical breakdown, as shipping blockades have halted the movement of vessels in and out of the region. While the Middle East was hit immediately, the crisis is also creating negative ripples in the SAARC region, particularly in Sri Lanka, which faces significant economic pressure.

Rising Operating Costs and Diesel Price Surges

A secondary threat to Tata Motors and its rivals like Ashok Leyland and VECV is the volatility of global oil prices. As crude prices balloon due to the conflict, there is a growing concern that rising diesel costs will squeeze the margins of fleet operators. High fuel prices increase the total cost of ownership for commercial vehicles, which may lead to softer sales as buyers become more hesitant to invest in new trucks and buses amidst rising daily operating expenses.

Shifting Focus to Domestic Resilience and EVs

Tata Motors is currently relying on its domestic strength in the infrastructure and mining sectors. Simultaneously, the company is looking toward the future of electrification, highlighted by the recent delivery of electric Prima E.55S trucks. This domestic pivot aligns with broader market trends, such as Delhi’s draft EV Policy, which is expected to significantly boost electric vehicle penetration across India and force automakers to accelerate their green energy investments.

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