CPSE bosses to travel in style as govt upgrades staff car purchase norms

The government has raised the engine cap for central public sector enterprises staff cars from 2,000 cc to 2,500 cc, allowing its executives to buy India-made vehicles under new guidelines

Senior executives of India’s central public sector enterprises (CPSEs) will soon be able to travel in upgraded vehicles, as the government has revised norms governing staff cars, according to a report by The Economic Times. The move aims to modernise official fleets while promoting vehicles made in India and encouraging financial discipline among state-run companies. 

The Department of Public Enterprises (DPE) has issued new guidelines allowing CPSEs to purchase staff cars with engine capacities of up to 2,500 cc, higher than the earlier ceiling of 2,000 cc. These cars must be manufactured in India, fuel-efficient and approved by the company’s board of directors before purchase, the news report said. 

According to the DPE circular shared with all Ratna CPSEs last month, “CPSEs may purchase models of vehicles manufactured in India, not exceeding 2,500 cc, for staff car purposes and field visits.” 

The type of car that each enterprise can choose will depend on factors like its Ratna status, schedule category, adopted pay scales and overall financial prudence, The Economic Times mentioned.

 

Preference for electric, hybrid cars

While the government has underlined its preference for electric and hybrid vehicles, the DPE has cautioned CPSEs to consider their financial strength before opting for such models. EVs and hybrids generally cost more than conventional petrol or diesel cars, and the purchase decision must align with each organisation’s fiscal position. 

The new norms also cover the replacement of existing vehicles, allowing it only with prior board approval to ensure transparency and accountability. 

Private use of official cars will not be permitted under the new rules. For any personal trips, a monthly recovery charge of ₹2,000 will apply.

 

 

  Auto sector sees sales boost in September

India’s automobile market saw a strong performance in September, helped by the recent goods and services tax (GST) rationalisation that made several models more affordable during the Navaratri period. 

Leading manufacturers such as Maruti Suzuki, Tata Motors and Mahindra & Mahindra reported strong demand, with Tata and Mahindra moving ahead of Hyundai Motor India in total wholesales.

  Maruti Suzuki India Ltd said its total domestic passenger vehicle dispatches to dealers stood at 132,820 units. Sales of compact cars such as the Baleno, Dzire, Ignis and Swift increased to 66,882 units from 60,480 a year ago. Utility vehicle sales, including Grand Vitara, Brezza, Ertiga and XL6, dropped to 48,695 units from 61,549 earlier.

 

GST cut drives demand across segments

The government’s decision to simplify GST slabs from September 22 has significantly impacted the automobile market. A two-tier system, 5 per cent and 18 per cent, replaced the earlier structure, lowering taxes.

• Petrol, LPG and CNG cars (below 1,200 cc and 4,000 mm in length) and diesel cars (below 1,500 cc and 4,000 mm) now attract 18 per cent GST, down from 28 per cent

• Motorcycles up to 350 cc are also taxed at 18 per cent, reduced from 28 per cent

• Larger vehicles (above 1,200 cc or 4,000 mm in length) and motorcycles above 350 cc continue to attract a 40 per cent levy

• Electric vehicles remain at the 5 per cent GST slab