The Indian passenger vehicle market is currently experiencing a surge in activity. The reduction in Goods and Services Tax (GST) rates has led to a noticeable increase in consumer spending and sales figures for automobile manufacturers. Showrooms of leading companies like Maruti Suzuki, Hyundai, and Mahindra are witnessing a rise in customer visits. Bookings have reportedly quadrupled in the days immediately following the GST rate adjustments.
This boost in demand stems from strategic inventory management and the anticipation of lower prices. Leading up to the GST changes, companies and dealerships focused on clearing existing stock. The revised GST structure, with an 18% rate for smaller cars and sub-4 meter SUVs (down from 28% plus cess), is directly translating into significant savings for buyers, ranging from 8.5% to 10%.
The festive season, including Navratri and the upcoming Dhanteras and Diwali, is playing a key role in amplifying this positive trend. The initial response during Navratri has been exceptionally strong, and sales are projected to exceed last year’s figures by a substantial margin. Sales could potentially double if supply chain issues and financing are streamlined.
Maruti Suzuki has reported a rise in daily bookings from 10,000 to 15,000 units, with 30,000 vehicles delivered on the first day of Navratri. Tata Motors also delivered 10,000 vehicles during the initial phase of the festive season, confirming the widespread positive impact of the GST rate cuts.