Hyundai Motor India Reacts to GST Reforms, Expects Benefits for Majority of Lineup

As fresh details of the impact of India’s new GST regime continue to emerge, Hyundai Motor India Ltd (HMIL) has released an official statement praising the move and reiterating the company’s support for government initiatives including Make in India. 

In a press statement, HMIL Managing Director Unsoo Kim said “We at Hyundai Motor India Limited (HMIL) welcome the landmark GST reforms announced by the Government of India. This revolutionary step will provide a strong impetus to the Indian economy, enhance buoyancy and further strengthen consumer confidence. By reducing the tax burden on essential goods, the Government has laid the foundation for inclusive growth and a robust, consumption-led economy. The GST overhaul will directly benefit the automotive sector.”

Regarding impact on Hyundai’s lineup of cars in India, Kim added “Notably, 60 percent of our ICE portfolio will now fall under the 18 percent slab rate, with the remainder at 40 percent.”

As the policy favours cars under 4m in length, the majority of Hyundai’s models will be categorised into the new lower 18 percent tax slab, down from 28 percent. The ICE models that stand to gain are the Hyundai Grand i10 Nios, i20 and i20 N-Line hatchbacks, Aura subcompact sedan, Exter micro SUV, Venue and Venue N-Line subcompact SUVs, all of which measure under 4m in length.

However, the popular Creta, Creta N-Line, Alcazar and Tucson SUVs along with the Verna sedan all exceed 4m in length, resulting in them being subject to the higher 40 percent tax.

Counting by the number of models, 58 percent (seven out of 12 ICE models) are sub-4m while the other five are all larger. The Hyundai Creta, which falls under the higher tax bracket, is consistently the company's best-selling model, with over 12 lakh units sold since its launch a decade ago. It is closely followed by the sub-4m Venue and other compact models.