GST effect: Automobile companies reduce prices
Several automobile companies have reduced their vehicle prices after the rollout of the Goods and Services Tax (GST).
Automobile majors like Maruti Suzuki, Hero MotoCorp, Jaguar Land Rover (JLR) and Audi India announced that they have reduced prices on various models.
However, owing to withdrawal of tax concessions on mild hybrid vehicles, the prices of vehicles in this category like Maruti Suzuki's "Smart Hybrid Ciaz Diesel" and "Smart Hybrid Ertiga Diesel" have been increased.
Similarly, Toyota Kirloskar Motor hiked prices of its hybrid variants Toyota Camry and Toyota Prius by over ₹ 3.5 lakh in Bangalore and going up to ₹ 5.24 lakh in New Delhi as per applicable tax under GST framework.
On its part, automobile major Maruti Suzuki India said that after the implementation of GST, the ex-showroom prices of its models have come down by up to three per cent.
"The rate of reduction varies across locations depending on the VAT (value added tax) rates applicable prior to GST," the company said in a statement.
According to luxury automobile manufacturer Jaguar Land Rover (JLR) India, it has reduced prices of its locally manufactured models by seven percent on an average.
"Post GST regime, Jaguar Land Rover's locally manufactured prices have come down by seven per cent on an average," the company said in a statement.
Another luxury car manufacturer Audi India said that it has reduced prices between three per cent to nine per cent depending upon the model and region post GST implementation.
"The new realigned prices offer great opportunity to expand the market and widen our customer base," said Rahil Ansari, Head, Audi India.
In addition, Toyota Kirloskar Motor reduced prices of its models by up to 13 per cent.
The company said that price change will vary from state to state, model to model and variant by variant depending on tax rates applicable prior to GST.
"We are hopeful that the price decrease post GST will further boost the customer demands in the coming months," said N. Raja, director and Senior Vice President, Marketing and Sales, Toyota Kirloskar Motor.
"The GST will be fruitful for the growth of the Indian auto industry. We think the industry will break into double digit growth territory this year."
Two-wheeler major Hero MotoCorp said that it has reduced prices of models across its product portfolio in most of the states.
"The quantum of reduction ranges from Rs 400 to Rs 1,800 on mass-selling models. The actual benefit varies from state to state, depending on the pre and post-GST rates," the two-wheeler major said in a statement.
"Some of the premium segment models would see a reduction of up to ₹ 4,000 in certain markets. In one or two states, such as Haryana, where the pre-GST rates were lower than the post-GST rate, the prices of a few models may go up marginally."