The impending new budget, plans to pull back the 4 per cent waiver on excise duties that was introduced last December.
This comes as a virtual blow to the Indian car buyer who would have to shell extra bucks on his new car. When the waiver was in effect, even luxury cars were offered at Rs 50,000 less than the actual price tag of the car. If this excise duty is restored car prices will spike up and car ownership will become very difficult.
The Indian Government had offered a 4 percent waiver as a part of its stimulus package to the auto industry when economic slowdown was at its peak. The package helped many car companies in India remain buoyant in those hard times. Even the big players like Maruti Suzuki and Hyundai Motors thanked the government for extending such a generous incentive and had requested to continue it. The car manufacturing lobby is working hard to pressurize the government to continue with this incentive for another year.
Infact, the magnificent performance of Auto Inc in June is attributed to the rush to buy their favourite cars at lower prices. People would be saving money if they bought the car now than later.
The government is adamant on restoring the excise duty at all costs and if it is bought back, the car industry in India will be hit the hardest. It may go back to days of slowdown and even post negative growth. On the other hand people buying cars later in the year will be paying more for the same car compared to their peers who buy it before the budget. This is unfair on new car buyers later in the year.
The government needs to rethink about the practicality about bring back a law that would scare way new car buyers in India.
This comes as a virtual blow to the Indian car buyer who would have to shell extra bucks on his new car. When the waiver was in effect, even luxury cars were offered at Rs 50,000 less than the actual price tag of the car. If this excise duty is restored car prices will spike up and car ownership will become very difficult.
The Indian Government had offered a 4 percent waiver as a part of its stimulus package to the auto industry when economic slowdown was at its peak. The package helped many car companies in India remain buoyant in those hard times. Even the big players like Maruti Suzuki and Hyundai Motors thanked the government for extending such a generous incentive and had requested to continue it. The car manufacturing lobby is working hard to pressurize the government to continue with this incentive for another year.
Infact, the magnificent performance of Auto Inc in June is attributed to the rush to buy their favourite cars at lower prices. People would be saving money if they bought the car now than later.
The government is adamant on restoring the excise duty at all costs and if it is bought back, the car industry in India will be hit the hardest. It may go back to days of slowdown and even post negative growth. On the other hand people buying cars later in the year will be paying more for the same car compared to their peers who buy it before the budget. This is unfair on new car buyers later in the year.
The government needs to rethink about the practicality about bring back a law that would scare way new car buyers in India.
Labels: Indian- Car-Buyers, Luxury-Cars, Maruti-Suzuki
1 Comments:
Potential car buyers have started to speculate over buying a new car with fuel prices soaring high. And now we have this new law. I hope that the Government gives a second thought before enacting this law. The Indian car market has been indiffrent to the global meltdown so far. we have seen the the advent of new cars like the Honda Jazz, Grande Punto, Jaguar and the Land Rover recently. With this new law I dont think any carmaker will introduce new cars to the market as people wont be interested to go for a new car.
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