From The Economic Times · Sharmistha Mukherjee · · 1m 20s
India's Car Sales Rise with GST and Income Boost
India's car sales surge as GST cuts and income growth drive demand despite price hikes.
In brief
India's car sales surge as GST cuts and income growth drive demand despite price hikes. India's car sales grew 29% year-on-year for vehicles with 18% GST rate due to income growth and GST cuts. Originally reported by The Economic Times.
Car prices rise 3% annually
Car prices have risen by about 3% over the past year amid inflationary pressures.
GST cuts boost affordability
GST on cars below four metres was cut to 18% from 28% while larger vehicles saw effective rates reduced to 40% from 43-50% including cess.
Disposable income grows 9.1%
Gross national disposable income increased by 9.1% in FY26 after rising 10.2% in FY25 and 10.9% in FY24.
Passenger vehicles with 18% GST surge 29%
Sales of passenger vehicles in the 18% GST category rose 29% year-on-year to 1.24 million units.
Tata Motors expects 10% industry growth
Tata Motors expects the overall industry to grow 10% during October-March and outpace the industry.
SUVs gain popularity
Consumer preference remains skewed towards SUVs with hatchbacks and sedans seeing revived demand.
Compact sedans grow to 350,000 units
Sales of compact sedans increased to 350,000 units last fiscal year from about 270,000 units in FY25.
The short version
India's car sales grew 29% year-on-year for vehicles with 18% GST rate due to income growth and GST cuts.
