GST rate cut anticipation leads to car sales slowdown
Car sales in India have taken a hit lately, with many people holding off on buying new vehicles in hopes that the Goods and Services Tax (GST) will be lowered soon.
Even though more folks are checking out cars online and visiting showrooms, actual purchases have dropped, leaving some dealers stuck with up to 90 days' worth of unsold cars.
The Federation of Automobile Dealers Association (FADA) and dealers attribute the slowdown to consumers delaying purchases in anticipation of possible GST reductions.
Companies are already slashing prices on some models
Dealers are concerned they could lose up to ₹2,500 crore because of the upcoming removal of GST cess—especially tough during festival seasons like Ganesh Chaturthi and Onam.
While customers are interested, most are waiting for official price cuts before buying.
To get things moving again, companies like Tata Motors and Mahindra & Mahindra have already slashed prices by over ₹1 lakh on some models, with BMW India dropping prices by as much as ₹9 lakh after the GST Council's decision to lower rates and remove the cess.