Bosch Car Service: Your Trusted One-stop Destination for Car...
- Mar 8, 2024
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The present government may have a firm vision on increasing manufacturing in the country but for luxury carmakers, it isn’t as easy as other industries. In a developing economy that will not provide the economies of scale for a long period, building luxury cars isn’t an option. Assembling them is the best luxury carmakers can do at present but the current taxation laws are making it very difficult for luxury marques to grow in India.
Audi India head Joe King said, “The economy is still in a recovery phase and the market condition is strained. The roll back of the excise duty cut has dampened the spirit of the luxury car market further. However, we are hopeful that the forthcoming budget will set the economy on the way to recovery.”
Audi is another carmaker hoping for GST implementation soon. “We hope for a favourable tax structure for the automotive sector in the Budget and look forward to industry friendly tax measures like GST. This will help release some of the pent-up demand.”
Volvo cars India only sells CBUs here but has a large and growing new car range that will soon be introduced in India. Several models are being developed with a plug-in hybrid option and so the Swedish carmaker is hoping for some action on NEMMP 2020. Tomas Ernberg, Volvo cars India said, “Concessional duties for greener cars and special custom duty concessions on Plug-in hybrids would further help towards realization of NEMMP2020 objectives.” Tomas Ernberg further added, “The industry also expects government to reintroduce concessional excise duty on vehicles and auto components and rationalise taxes in order to boost demand and help the industry to develop further.”
Most luxury carmakers have had a good sales year in India but as soon as the excise duties went up in 2015, they have had to resort to discounting which isn't healthy just to maintain sales momentum. Future investment and new product introductions will be hit in the long term. A favourable budget will help recover a segment that has huge potential in the long term.
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