Budget Cars Make Grand Comeback: Sales Soar 92% Under 5 Lakhs

• Small cars, priced under 5 lakh rupees, saw a massive 92% sales jump in December 2025 and January 2026.
• This resurgence marks a return to budget-friendly vehicles after years of SUV dominance.
• A key factor for the sales surge was the government's GST rate reduction on budget segment cars.
• Increased demand from small towns and rural areas, driven by improved infrastructure and agricultural income, also contributed.
• High mileage (up to 25 km/liter) and low servicing costs make small cars attractive amidst rising petrol prices.

Why It Matters: Affordable small cars are back in demand, driven by GST cuts and middle-class preference for savings and mileage.