GST effect: Toyota, Ford, TVS, Hero MotoCorp join price-cut bandwagon
After Maruti Suzuki and luxury automakers Mercedes-Benz, Audi, BMW and JLR, Hero MotoCorp and TVS too have announced a price cut post GST.Updated: Jul 03, 2017 16:08 IST
With two-wheelers and sport-utility vehicles attracting lower tax rates under the Goods and Services Tax, more automakers on Monday announced passing on the benefit to the customers and slashed their vehicle prices.
Chennai-based two-wheeler major TVS Motor Company cut prices of its models by up to Rs 4,150.
“The price reduction is in the range of Rs 350 to Rs 1,500 in the commuter segment. In the premium segment products, the prices are reduced up to Rs 4,150 depending on each state,” the company said in a statement.
TVS Motor Company said it will give “suitable assistance” to dealers who had bought vehicles from the manufacturers at pre-GST prices.
Hero MotoCorp’s two-wheelers too have become cheaper by Rs 400 to 1,800, as the company passed on the benefits of new tax to its customers. “The actual benefit varies from state to state, depending on the pre- and post-GST rates,” Hero MotoCorp said in a statement, adding that some premium segment models may even see a reduction of up to Rs 4,000 in certain markets.
Honda Motorcycles and Scooter India Pvt Ltd (HMSI), maker of India’s largest selling two-wheeler Activa, too announced passing on the benefit, on Monday.
“Starting July 1, Honda is passing on the GST benefit applicable in most of the states to our valued customers who now get significant savings going up to Rs. 5,500 depending on the model and the state of purchase,” the company said in a statement.
Suzuki Motorcycle India Pvt Ltd (SMIPL) too made its bikes and scooters cheaper by up to 2%, in an announcement on Monday.
Under the GST, two-wheelers of up to 350cc engine will attract a basic tax rate of 28%. For bikes with larger engines, an additional cess of 3% will be applied.
Maruti Suzuki and luxury automakers Jaguar Land Rover, Mercedes Benz, Audi India and BMW had already announced reduction in their car prices on July 1, in the range of 3% to 12%.
Toyota Kirloskar Motor also made its models cheaper by up to 13%. Both its bread-and-butter models - Fortuner SUV and Innova Crysta MPV -- have become cheaper under the new tax regime, which is why the company made and sold fewer vehicles in June, resulting in an 86% drop in domestic sales last month.
“We are hopeful that the price decrease post GST will further boost the customer demands in the coming months,” said N Raja, Toyota Kirloskar Motor’s director and senior vice-president of marketing and sales.
“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,” he added.
Ford Motor India too announced a 4.5% downward revision in its prices on Monday. This translates into discounts of Rs 2,000 on Ford Figo in Delhi and a Rs 8,000 on the compact SUV EcoSport. The SUV Endeavour will now be cheaper by Rs 1.5 lakh in Delhi while it will cost Rs 3 lakh lesser in Mumbai, a company spokesperson told PTI.
But hybrids have become more expensive, after they were slapped with the same taxes as on luxury cars - 28% GST and a cess of 15%.
Maruti Suzuki’s mild hybrids Ciaz and Ertiga are now costlier by more than Rs 1 lakh, while Toyota’s hybrid sedans Camry and Prius are now dearer by Rs 5.24 lakh in New Delhi.
BMW’s flagship hybrid sportscar the BMW i8 will now cost Rs 2.62 crore, up from Rs 2.14 crore pre-GST.
First Published: Jul 03, 2017 14:20 IST