The prices of the luxury cars in the Indian automobile sector has gone down from INR 125000 to INR 7 lakh. This applies to those cars which are locally assembled. However, the price reduction is on the anvil for the imported luxury cars as well.
GST has become a boon for those who want to buy a luxury car in India. Mercedes-Benz and BMW have reduced their prices even before the goods and services tax is been implemented.
The Jaguar Land Rover and Audi are next in line to reduce their prices ahead of the GST rollout. The reduction in the price of the Mercedes and the BMW cars are with immediate effect.
Today Mercedes-Benz India, which is the largest luxury car maker in India, has announced a downward revision of its car prices. The reduction in price is the ex-showroom price of the current cars and also on the Post-GST ex-showroom prices. The luxury car buyer will benefit because of the “Make in India” product portfolio of the luxury car maker.
Reduction in car prices is up to 4%, effective immediately and is geared towards providing value to the customer. Mercedes-Benz has announced the reduction in prices on its S-class, E-class, C-class, M-class and the expensive Maybach series of cars to name a few.
Roland Folger, who is the Managing Director and CEO of Mercedes-Benz India told the press, that they are passing the benefits of post GST pricing with the locally assembled cars to the customer with immediate effect. He emphasised that the company is looking to give the GST tax benefits at an earlier stage at the cost to the company. This would highly favour those who want to purchase the car in the month of June.
While locally assembled cars are seeing the benefit of GST. The electric car maker such as Tesla is finding it difficult to enter the car market because of 30% local sourcing rule.
The entire gamut of price reduction will be around 2-9 percent, depending on factors such as the tax structure and the local tax rates of the state. The weighted average comes out to be around 4% to the end user or the customer of the luxury cars.
At a time when Chevrolet is existing the Indian car market, the GST has come as a blessing for the other car manufacturers. This would increase or at least stabilize the jobs in this sector to great extend.
The impact of GST on the prices of CBU vehicles is yet to come to the realisation. The carmakers are confident that this is a right step in direction of good economic growth for the country. Across the luxury car makers, the GST is a welcome step benefitting both the carmaker and the customer.