The Indian automobile industry is witnessing a major shift following the introduction of the government’s new GST 2.0 tax regime. This policy change has brought significant modifications to the taxation structure of cars, directly affecting their market prices. Seizing this opportunity, Mahindra & Mahindra (M&M) has announced a major price reduction across its SUV lineup, ensuring that customers enjoy the full benefits of lower GST rates.
Not stopping there, Mahindra has also introduced additional festive season benefits, making the deal even more attractive for buyers. When combined, the tax cuts and festive offers provide customers with a potential saving of up to ₹2.56 lakh, depending on the model and variant. This move is expected to not only boost Mahindra’s sales but also increase competitive pressure in India’s SUV market, which is currently one of the most dynamic segments of the auto industry.
GST 2.0 and Its Impact on Cars
Mahindra SUV price cut The government’s implementation of GST 2.0 has restructured how cars are taxed in India. Earlier, vehicles were taxed under a uniform GST slab of 28%, with an additional cess (up to 22%) imposed on larger and luxury cars. Under GST 2.0, the slabs have been streamlined, creating two major categories:
- Small Cars (Sub-4 metre segment)
- Petrol engines up to 1200cc or diesel engines up to 1500cc
- Length under 4 metres
- Now taxed at 18% GST, down from 28%
- Large and Luxury Cars (Over 4 metres)
- Vehicles longer than 4 metres with larger engines
- Attract a flat 40% GST, which replaces the earlier combination of 28% GST + 22% cess
This tax overhaul has led to a reduction in prices for compact SUVs and smaller models, while bigger SUVs face a standardized but higher tax rate. For Mahindra, this means that models like the Bolero, Bolero Neo, XUV 3XO, and Thar 2WD enjoy the benefit of reduced taxation, while flagship SUVs such as the Scorpio Classic, Scorpio-N, Thar 4WD, Thar Roxx, and XUV700 are now adjusted under the 40% bracket.
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Mahindra’s Benefits and Discounts
To maximize customer appeal, Mahindra has introduced two levels of price benefits:
- GST-driven price reduction – Direct savings due to revised taxation
- Festive offers – Additional discounts in the form of cash savings, exchange bonuses, and free accessories
Here’s a detailed look at the savings available across Mahindra’s SUV portfolio:
Bolero & Bolero Neo
- Total Savings: Up to ₹2.56 lakh
- GST Cut: Up to ₹1.27 lakh
- Festive Benefits: Up to ₹1.29 lakh
- New Starting Price: ₹8.79 lakh (ex-showroom)
XUV 3XO
- Total Savings: Up to ₹2.46 lakh
- GST Cut: Up to ₹1.56 lakh
- Festive Benefits: Up to ₹90,000
- New Starting Price: ₹7.28 lakh (ex-showroom)
Thar (2WD/4WD Variants)
- Total Savings: Up to ₹1.55 lakh
- GST Cut: Up to ₹1.35 lakh
- Festive Benefits: Up to ₹20,000
- New Starting Price: ₹10.32 lakh (ex-showroom)
Scorpio Classic
- Total Savings: Up to ₹1.96 lakh
- GST Cut: Up to ₹1.01 lakh
- Festive Benefits: Up to ₹95,000
- New Starting Price: ₹12.98 lakh (ex-showroom)
Scorpio-N
- Total Savings: Up to ₹2.15 lakh
- GST Cut: Up to ₹1.45 lakh
- Festive Benefits: Up to ₹71,000
- New Starting Price: ₹13.20 lakh (ex-showroom)
XUV700
- Total Savings: Up to ₹2.24 lakh
- GST Cut: Up to ₹1.43 lakh
- Festive Benefits: Up to ₹81,000
- New Starting Price: ₹13.19 lakh (ex-showroom)
Why Mahindra’s Move Is Significant
Mahindra’s announcement is more than just a festive offer—it could be a game changer for the Indian automobile market. Several key outcomes are expected from this price restructuring:
- Boost in Sales During Festive Season
With Diwali and other major festivals approaching, the timing couldn’t be better. Lower prices combined with attractive discounts will likely encourage more customers to upgrade or purchase new SUVs. - Intensified Market Competition
Mahindra’s aggressive pricing strategy will put pressure on rivals like Tata Motors, Maruti Suzuki, Hyundai, and Kia, who may be forced to introduce similar offers to retain market share. - Revival of the Auto Sector
India’s automobile industry has experienced sluggish growth in recent years due to inflation, rising fuel prices, and post-pandemic recovery issues. Reduced pricing could reignite consumer interest, leading to stronger demand and faster market recovery. - Enhanced Consumer Trust
By passing on the tax benefits directly to customers instead of retaining margins, Mahindra is likely to strengthen its brand loyalty. This transparency adds to consumer confidence in the company.
Strategic Importance for Mahindra
This move comes at a critical time when the competition between EVs and traditional ICE (Internal Combustion Engine) vehicles is heating up. While many automakers are focusing on expanding their electric vehicle portfolios, the demand for SUVs in the petrol and diesel segments remains strong in India.
By cutting prices and making its SUVs more accessible, Mahindra is aiming to:
- Defend its market share in the compact SUV segment against Tata Nexon, Hyundai Venue, and Maruti Brezza.
- Strengthen its hold in the mid-size SUV market, where the Scorpio-N and XUV700 compete against popular models like Hyundai Creta, Kia Seltos, and Toyota Hyryder.
- Position itself as a customer-first brand, showing adaptability to government policy changes.
