Thursday, February 28, 2013
By Carkhabri Team
Auto Industry gives thumbs down to Union Budget 2013-14!
The Union Budget 2013-14 is finally out and auto industry isn’t very pleased with it. Many car makers have expressed their annoyance and discontentment with the budget this year. The major disappointment here was caused by a hike in the import duties on the cars and bikes, which arrive here as CBU. This means that cars like Mercedes Benz, Audi, Jaguar, Volkswagen, Land Rover and BMW will have to rise a bit of price. On the other hand, luxury sports car makers like Ferrari, Porsche, Lamborghini and Rolls Royce will have amplified excise duty of 100%.
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Besides this, the new Union Budget 2013-14 also mentioned that the import duty on completely built motorcycles with an engine of more than 800cc will be hiked to 75%. This means that Harley motorcycles will become dearer. As expected before, the excise duty on the SUVs have also been increased by 3% and are currently at 30%. This brings in a bad news for Ford, which is on the verge of launching its much anticipated sporty SUV, Ford EcoSport. The MD of Ford India, Mr. Joginder Singh wasn’t expecting such drastic budget. The high excise duty on SUVs came up as the major issue here. Now, it puts too much of pressure on Ford to keep their SUV competitive in terms of price as the SUV segment in the Indian car market has already become a battle field.
On the announcement of Union Budget, the Auto industry gave reactions that were certainly expected from that. The president of SIAM, Mr. S. Sandilya, stated that he is kind of relieved that the overall tax rates are kept as it is. However, he was displeased as well with the decision that SUVs will have to face higher excise duties, just because they occupy more parking spaces. Similar reaction came from the VP of General Motors India, Mr. P. Balendran.
Let’s hope that this time around the Indian car market isn’t as sluggish as last year and turn out to be quite proficient. Only then this dissatisfying budget would work!