Hyderabad: The festival season has turned brighter for the automobile industry, with the recent GST rate cut triggering a surge in new vehicle purchases. Buyers waited nearly a month after finance minister Nirmala Sitharaman announced that the GST rates will be slashed from September 23. Once the revised rates came into effect, people rushed to showrooms to buy new vehicles, driving record-high sales for automobile companies.
Subbiah C., a bank employee, was among the early buyers. “I saved Rs 1.5 lakh on a Tata Nexon automatic base model. Before the GST cut, it was priced Rs 14.4 lakh, but now it is Rs 12.9 lakh,” he said, adding that the high demand has created waiting periods as vehicles are quickly going out of stock.
According to transport department officials, “On average, around 5,000 vehicles are registered across the state daily. While official figures on the latest sales are awaited, market reports suggest a surge in registrations in the coming days.”
“The GST cut has boosted sales by over 20 percent this festival season. Segments now taxed at 18 per cent instead of 28 per cent are showing particularly strong demand,” said Ramesh P., head of sales operations at a major automobile chain.
Showrooms in Hyderabad are also offering aggressive promotional campaigns to tap into the festival sentiment of bringing home something new.
However, the second-hand vehicle market is feeling the pinch. Dealers admitted that their investments in used cars have taken a hit, as they are now forced to reduce prices further to stay competitive against the lowered rates of new vehicles.
