GST Impact: Change In Car Prices Explained

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GST or Goods and Service Tax has to be one of the most confusing terms in the Indian economy ever. However, things have become a bit clear in the past few weeks. GST will make an impact across all industry segments in India and this includes automotive domain as well. So is GST beneficial for new car owners? Lets have a look

The Indian car segment can broadly be classified into the following:

  1. Small cars (under 4 meters)
  2. Mid size sedans / mid size SUVs (over 4 meters but engine under 1.5-litre)
  3. Luxury cars (engine over 1.5-litre but GC under 170 mm)
  4. Luxury SUVs (engine over 1.5-litre and GC over 170 mm)
  5. Hybrid cars

Without getting into the nitty-gritty of things, lets come to the point that concerns all – will the cars be more expensive or cheaper? Lets start with the segments that will not benefit

CARS THAT WILL BECOME EXPENSIVE

Small cars like the WagonR will become marginally cheaper
Small cars like the WagonR will become marginally expensive
  1. Small cars: pricing for these cars will go up by approximately 1-2% which translates into Rs 7000 – 10000 for hatchbacks
  2. Mid size sedans: This segment too will witness an increase in prices for petrol models by about 1% or by about Rs 8000-9000.
  3. Hybrid cars: Set for an increase of 2-3%
  4. Hybrid cars: Increase of 50k to 1 lakh for cars like the Ertiga / Ciaz / Scorpio (mild hybrids) and 2-2.5 lakh for the Camry mild hybrid

CARS THAT WILL BECOME CHEAPER

isuzu-mu-x-india-images-colours-orchid-brown
The newly launched MUX becomes cheaper by 1.5 lakh
  1. Luxury Petrol Cars: By around 2-3%
  2. High end Diesel SUVs: By around 5-6%

Here are some examples of price cuts being done by various car companies

  1. Toyota Fortuner: Upto Rs 1.2 lakh
  2. Isuzu MUX: Upto Rs 1.5 lakh
  3. Jaguar XE: Rs 2 – 5.7 lakh
  4. Jaguar XJ: Upto Rs 11 lakh
  5. Landrover Discovery Sport, Range Rover Evoque – Upto Rs 7.5 Lakh
  6. Mercedes Benz – An Average of 4% Price Cut in Several Lakhs from GLA to GLS
  7. Audi – From Rs 1.5 Lakh on A3 to as high as Rs 10 Lakh on A8
  8. Audi Gurgaon is offering the A3 for 29.99 lakh, A4 for 36.99 lakh, A6 for 46.49 lakh and Q3 for 30.49 lakh (ex-showroom)
  9. BMW – High Discounts along with BMS BSI Package, Free Insurance options
  10. Minor cuts of 1% on cars like the BR-V, Duster, EcoSport, TUV300, Brezza etc
  11. Minor cuts of 3% on cars like the XUV500 (engine over 1.5 but GC under 170mm)
  12. 5-6% on SUVs like Creta, Santa Fe, Endeavour, Hexa etc (engine over 1.5 and GC over 170mm)

Also read:
1) India’s 5 most expensive SUVs
2) This might be the XUV700!

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