New GST rates revive auto companies' hope for a festive sales spurt

The GST rate revision is expected to lead to a notable reduction in ex-showroom prices across passenger vehicles, with small cars, SUVs and mid-sized models seeing savings of ₹50,000 to nearly ₹1 lakh for popular vehicles such as the Wagon R, i20 and Scorpio N.

 

Small petrol and diesel cars now attract only 18 per cent GST compared to 29–31 per cent earlier.

 

SUVs and mid-sized cars face a reduced levy of 40 per cent against the previous 45–50 per cent, making them more affordable for mass-market buyers. The impact on luxury cars is relatively modest, with models like the BMW 5 Series witnessing a price drop of about ₹1.6 lakh despite higher base value. Analysts believe the move will boost affordability, support festive-season sales and revive overall passenger vehicle demand by easing cost burden on consumers.