Maruti Suzuki passenger vehicle sales rise 36% after GST 2.0

Maruti Suzuki India is stepping up its capital expenditure plans as passenger vehicle demand gains momentum following the GST 2.0 tax rationalisation, Managing Director and CEO Hisashi Takeuchi said on Tuesday, marking one year since the changes came into effect.

Maruti Suzuki’s passenger vehicle sales increased by around 36 per cent year-on-year between April and August 2026, while sales in the entry-level segment jumped more than 96 per cent during the period, Takeuchi said in a post on X.

He said the stronger demand reflects the impact of improved affordability and highlighted the broader potential for domestic manufacturers to achieve greater scale, improve competitiveness and expand exports. Against this backdrop, the company plans to accelerate its capex, which Takeuchi said could generate wider economic benefits.

Mahindra & Mahindra Executive Director and CEO Rajesh Jejurikar also said GST rationalisation had strengthened demand across key automotive categories. Since the tax changes, SUVs have grown 17 per cent, while light commercial vehicles and tractors have increased by around 20 per cent, he said. The company is also adding 4,000 units of EV production capacity by March 2027.

The GST Council’s revised tax structure came into effect on September 22, 2025. Under the changes, specified small petrol, LPG and CNG cars and certain diesel vehicles were moved from the 28 per cent GST slab to 18 per cent.

The Federation of Automobile Dealers Association (FADA) said the reform has significantly improved vehicle affordability. FADA President Sai Giridhar said auto retail sales crossed 3 crore vehicles between October 2025 and August 2026, representing nearly 20 per cent year-on-year growth, compared with less than 5 per cent growth in the corresponding period before the reform.

Giridhar attributed the momentum to lower on-road costs for mass-market vehicles, including small cars, two-wheelers, tractors and commercial vehicles. He also pointed to strong rural demand and growth across alternative-fuel vehicles, while noting that manufacturers continue to face cost pressures from global crude, commodity and currency movements.

with inputs from PTI