Hatchback sales in India have been on a declining trend in recent years, with consumer choices shifting to compact and medium-sized sports utility vehicles (SUVs).
The Tata Punch micro SUV, for instance, emerged as the number one selling vehicle, with over 2 lakh units sold in the calendar year 2024. The homegrown automaker still sees an opportunity in the small car space and has now launched the updated Altroz premium hatchback.
The Altroz first debuted in 2020 and competes with Maruti Suzuki Baleno and Hyundai's i20. Japanese car maker Honda had discontinued its premium hatchback Jazz back in 2023.
The new Altroz that was launched on Thursday, is the first major update the vehicle has got since its launch.
Prices of the new Altroz start at ₹6.89 lakh ex-showroom, going up to ₹11.29 lakh. The Altroz will continue to be available in a manual and DCA automatic transmission. Additionally, Tata Motors has now introduced an AMT gearbox for the Altroz in a bid to attract more buyers, especially those who may want to drive an automatic vehicle, but may not have the financial capacity to go all the way to the top-spec DCA automatic.
Also, importantly, Altroz is the only premium hatchback that still gets a diesel option, apart from petrol and CNG variants.
Shailesh Chandra, managing director of Tata Motors Passenger Vehicles and Tata Passenger Electric Mobility says the premium hatchback segment is very demanding from a customer standpoint, with people seeking features as well as value for money.
The Altroz is equipped with premium features, including a dashboard with soft-touch finishes, dual 10.25-inch displays for infotainment and instrumentation, a 360-degree surround view system, a voice-assisted sunroof and 65w front and rear chargers, flush door handles up front among other things. It gets several exterior changes too.
The Altroz is launching at a time when consumer demand in India has seen a definitive shift towards SUVs.
In the 2024-25 financial year, 4.3 million PVs were sold, according to the Society of Indian Automobile Manufacturers (SIAM), up 2 per cent over the previous year. Utility vehicles contributed 65 per cent of the sales, up from 60 per cent earlier.
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In 2024-25, while utility vehicle sales rose 11 per cent, car sales, actually, saw a 12.6 per cent degrowth.
Chandra remains hopeful of the Altroz doing well in the premium hatchback space, especially given the rising high-income households.
"Over the past three years, more than 1 million premium hatchbacks have been sold. The share of premium hatchbacks within the hatchback category has consistently grown and we expect the segment to remain strong because high-income households are expected to double in this decade with nearly 65 million households having an annual income of more than 15 lakhs by 2030," he said.
Bookings for the Altroz start from June 2.