Higher taxes may dent sales in India; Auto firms still hopeful
The super luxury car sales in India is likely to drop to 120 units in this calendar year as compared to 140 units sold in 2013. (Photo: PTI/File)
Mumbai: Weak consumer sentiments coupled with a drastic increase in import duty has hit the sales of super luxury cars in India.The sales of super luxury cars, which are generally priced above Rs 2 crore, is expected to further drop by over 14 per cent in 2014.
According to industry estimates, the super luxury car sales in India is likely to drop to 120 units in this calendar year as compared to 140 units sold in 2013. The segment had witnessed a negative growth of 15.66 per cent and 19 per cent respectively in 2013 and 2012 on account of subdued sentiments and higher import duty.
Speaking on the sidelines of the launch of the new Rolls-Royce Ghost Series II, Sven J. Ritter, general manager, Asia Pacific, Rolls-Royce Motors, however, said that the growth potential in India is much higher than other markets and a cut in import duty would help in boosting the sales of super luxury cars in India.
“Over the last two years, taxes have gone up. We would welcome the government to relook at the tax rate and go back to the earlier rates, which will help the market to grow. But it is up to the government to decide,” he said.
The basic customs duty, which was at 60 per cent in FY11, was hiked to 75 per cent in FY12. This was further increased to 100 per cent in FY13. This along with other duties now stands at 174 per cent. Following such a steep increase in import duty, Rolls-Royce car, which was available for Rs 2.7 crore a few years back is now priced at around Rs 5 crore.
According to Sharad Kachalia, director of Navnit Motors and principal dealer for Rolls Royce Motors in India, the growing number of ultra-high net-worth individuals in India provides a huge growth opportunity for super luxury carmakers in India.
( Source : dc correspondent )
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