The 2013 Union Budget has brought nasty surprises for all the SUV makers in India. As per the recent budget all the cars which carry engines bigger than 1.5-liters in capacity, length greater than 4-meters and also with a ground clearance more than 170 mm are to be classified as SUVs. As per the Government of India the increase in excise duty, according to the new budget is due to the fact that the car which satisfies all these above specifications occupies more space and results into congestion.
As the result of this new Budget, Mahindra’s Bolero which is the most selling MUV in India followed by Scorpio and XUV 500 which falls under the category of SUV’s had to react to this. Thus, Mahindra has hinted that it is possible for his firm to downsize the engine capacity of some of its products to below 1.5-litre and also decrease the ground clearance of its range of vehicles to a little less than 170 mm as reported by Dr. Pawan Goenka, Head-Automotive of Mahindra in the Facebook page of Young Turks in a view that Mahindra’s range might no longer be classified under the higher excise duty bracket.
However, Dr. Goenka did not mention about the models that are being redefined. But he was quick to point out that not all Mahindra SUVs could escape the duty hike. Further, expressed his disappointment that the SUVs are singled-out by the Union Budget.
With already plans by Mahindra of reducing the ground clearance, same is expected to be followed by the other SUV makers in the Indian market, especially Tata Motors and Force Motors which have also been worst hit by the excise duty hike but the Government’s policy has a glitch and the automobile manufacturers in the country will try to take full advantage of that issue.
Source – Young Turks (on Facebook)