No plan to increase vehicle prices from January; will not undermine GST rate cut initiative: Mahindra

Indian SUV giant Mahindra & Mahindra (M&M) does not expect car prices to rise from January next year unless boosted by a significant rise in commodity prices, a top company executive said on Thursday.Given an automotive trend where automakers typically announce price increases every year from January onwards, Mahindra executive director and CEO for automotive and agriculture Rajesh Jejurikar said: “We will not accept price increases at this time unless they are driven by a significant raw material price.”Also read: Mahindra launches XEV 9S: Check the price, features and the automaker’s motive behind the new 7-seater EV SUV

“We are very aware that the country has taken a very important milestone action by reducing VAT, and we will not do anything that undermines that strategy by pursuing a profit motive to increase prices,” Jejurikar said.

“So we will only increase prices if there is a very visible and tangible increase in production costs. We will not announce price increases just because that is the typical practice,” he added.

With the next-generation GST reforms in place, automakers announced price cuts with effect from September 22, passing on the benefits to consumers. The GST Council’s decision to rationalize tax rates and simplify the tax regime pushed most small and medium cars into a lower tax bracket of 18% (from 28%), while also reducing the effective tax on most large SUVs and luxury vehicles from around 50% to a flat 40%.

Also read: Mahindra launches world’s first Formula E-themed SUV at Rs 23.69 lakh; early buyers get exclusive rewardsWhile EVs continue to enjoy 5% GST as before, Indian automakers are focusing on a green push to take a bite into the growing but price-sensitive market. Mahindra also launched a new electric 7-seater SUV XEV 9S, priced at Rs 29.45 Lakh (ex-showroom).