The Society of Indian Automobile Manufacturers (SIAM) held its 65th annual conference, with the recent GST rate cuts being a central theme. These cuts placed passenger vehicles and two-wheelers (under 350cc) within the 18% tax bracket.
The lowered GST is translating into reduced vehicle prices, particularly benefiting buyers of smaller cars and compact SUVs. Hyundai Motor India noted price drops up to 13% in the small SUV segment, and Maruti Suzuki expects substantial growth in the small car category.
However, the industry is also facing challenges. The compensation cess is a concern, with FADA expressing worries about its impact on dealers’ e-credit ledgers. This could pose financial difficulties for dealers and OEMs during the upcoming festive season. The government is aiming for a resolution, but significant financial losses are anticipated during the Navratri sales period.
E20 fuel is another topic of discussion, with online debates about potential effects on mileage and engine performance. Union Minister Nitin Gadkari has countered these arguments, attributing them to the petrol lobby.
Electric vehicle adoption continues to lag in India. Despite over ₹40,000 crore in subsidies and incentives, EVs represent only 7.6% of overall vehicle sales, well below the 30% target by 2030.