The hybrid vehicle cess has not been increased, effectively giving these vehicles a 2-7 per cent cess relief, he added. This is a good step, since these also need promotions. "We hope this demand to continue through the rest of the year".
Since the biggest reform in the country's tax structure came into effect and instantly caused auto prices to tumble down, the GST Council approved a cess hike on Saturday, which will take prices of many cars close to the pre-GST era. "Also, now there are a few more slabs of taxes on the auto industry as compared to the erstwhile excise duty structure", he said. The council which is headed by Arun Jaitley decided not to levy additional tax on small cars of up to 1200 cc in both the segments - viz Petrol and Diesel.
According to Vishnu Mathur, director general, SIAM, "The PV numbers could be ascertained to remain sustainable hereon because the basic economies have become right". The impact on rural markets is slowly wading off.
CV sector moving into growth mode for the long termThe commercial vehicle industry seems to be leaving behind the disruption of implementation of BS IV norms and GST and gradually returning to growth path.
It says the main drivers of growth for vehicle sales are the GDP growth of around 7%, repo rate decreased in the third bi-monthly monetary policy for this financial year, good monsoon season and higher farm income, and higher income levels and consequently higher disposable income.
The industry produced a total 11,950,356 vehicles including passenger vehicles, commercial vehicles, three wheelers, two wheelers and quadricycle in April-August 2017 as against 10,919,150 in April-August 2016, registering a growth of 9.44 percent over the same period previous year.
In the April-August 2017 period, overall CV sales are up marginally by 1.58 percent with total volumes of 276,147 units. Last week, an ordinance was promulgated to hike the cess from 15% to up to 25%. The same grew around 17% in July and about 3% in June.
Sales of passenger cars stood at 198,811 units, registering a growth of 11.80 percent (August 2016: 177,829). Within the Two Wheelers segment, Scooters and Motorcycles grew by 18.27 percent and 7.89 percent respectively, while Mopeds declined by (-) 8.60 percent in April-August 2017 over April-August 2016.