Automakers, retailers pass tax benefits to customers, slash prices after GST rollout

Maruti Suzuki June sales

Maruti Suzuk Ciaz’s growth was most likely driven by purchases in the pre-GST sale as the new tax on hybrids is now up from 12% earlier to 28

The Ciaz premium sedan, which is now sold only from the premium Nexa channel, sold a total of 3,950 units, up 41 percent YoY (June 2016: 2,800). Demand continued to be strong for utility vehicles -Ertiga, S-Cross, Gypsy and Brezza - and rose by 43% to 13879 units.

Passenger vehicle sales during the month were at 11,176 units, down 10% from 12,482 units in June 2016.

The hot selling "Swift" auto maker, Maruti Suzuki on the very first day of the GST rollout announced that it will pass on the entire benefit of GST rates on vehicles to its customers.

The figure for vans, Omni and Eeco, declined 6.7% to 9,208 units last month compared to 9,874 in the same period of the previous year. However, sales of the mini segment (Alto, WagonR) fell by 8 per cent year-on-year to 25,524 units during the month as against 27,712 units in June 2016.

Export volumes nearly doubled in June at 13,131 units when compared with 6,707 units.

According to the company, after the implementation of GST, the ex-showroom prices of its models have come down by up to three per cent. "This drop in volume is seen temporary and will be recovered in the quarter to come based on 11% growth in April-June 2017 quarter compared to the a year ago", Tata Motors said in a statement. This makes the company the latest addition to the growing bandwagon of auto manufacturers who have directly passed on the tax benefits received under the new GST system to the consumer.

The automaker said sales of the compact segment comprising Swift, Estilo, Dzire, Baleno and Ignis rose 1.3% to 40,496 units in June compared to 39,971 in the same month past year.

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