By Shally Mohile
Copyright indiatimes
Hero MotoCorp and Bajaj Auto are among companies deciding to absorb the higher goods and services (GST) rates on premium motorcycles to continue attracting buyers amid subdued demand and escalating competition.The government raised the GST rate on more than 350cc motorcycles to 40% from 31% with effect from September 22. It, however, cut the tax on less than 350cc motorcycles to 18% from 28%.Crucial Festive SeasonSales of motorcycles in the 350cc to 500cc category, including Husqvarna, Harley-Davidson X440, KTM, and Royal Enfield Guerilla models, fell 6% from a year earlier to 51,412 units in the first six months of this fiscal year, according to the Society of Indian Automobile Manufacturers.ET BureauCompanies fear passing on the higher duties could further weigh on premium motorcycle demand especially during the crucial festive season. “The 350cc+ segment is showing a decline for us after the GST implementation as expected… mainly due to the (tax rate on) 350 minus segment going down to 18%,” said an executive an at a two-wheeler company.Hero is continuing to retail the Harley-Davidson X440 at pre-GST prices, while Bajaj has maintained pricing across its Triumph and KTM range.Live EventsRoyal Enfield, the leader in the mid-size motorcycle market, is the only mass-market brand to pass on the GST hike, raising prices of over 350cc models.Companies are adopting the latest strategy after a pre-GST sales surge in premium bikes with customers rushing to showrooms to beat the price increase. Some manufacturers and dealers believe passing on the higher GST rates would deter many buyers.Premium sports motorcycle brand KTM has kept ex-showroom prices unchanged across its 390cc lineup. “By absorbing the incremental impact, KTM has ensured that riders can continue enjoying its racing DNA on favourites like the 390 Duke, 390 Adventure, and RC 390, without any additional costs, starting this festive season,” Bajaj Auto said last week. Models below 350cc-including the 160 Duke, 200 Duke and 250 Duke-have benefited from the GST cut, making them more accessible.Triumph has also absorbed the higher taxes, ensuring prices of its Speed 400, Scrambler 400X, and new Thruxton 400 remain unchanged, strengthening its position in the fast-growing mid-capacity segment.Ducati, by contrast, has raised prices by ₹1.36-₹2 lakh across its portfolio. “We’ve managed to do decent sales this month because customers had already anticipated the hike,” said Bipul Chandra, managing director of Ducati India. He, however, warned: “The real impact will be felt in October.”Shardul Verma, head of strategic marketing and brand at Classic Legends, maker of the Jawa, Yezdi, and BSA brands of premium motorcycles, said demand in the sub-350cc category has been robust, helped by recent launches and favourable tax treatment.Fresh Challenges”In the below-350cc segment we have nine motorcycles, and GST has really helped us. On top of that, we launched two new products-the Adventure and the Roadster-almost back-to-back, and the festive demand has been humongous,” he said.Verma acknowledged that the company has also chosen to absorb the GST hike on motorcycles above 350cc. “Volumes are concentrated in the below-350cc segment, so while the increase from 28% to 40% is being absorbed, the overall impact is limited. We continue to see a very strong uptick in our higher-volume models.” The sales surge, however, has brought fresh challenges. “We are actually facing a shortage of trucks because of the scale of demand. Logistics has become a constraint,” Varma noted.Dealers across the country are hopeful that festive incentives and schemes in October will help counter the demand slowdown in larger-capacity bikes.Add as a Reliable and Trusted News Source Add Now!
(You can now subscribe to our Economic Times WhatsApp channel)
Read More News onbajaj autohero motocorpbike makerspremium motorcyclesHero MotoCorpGST ratesBajaj AutoKTMRoyal Enfield
(Catch all the Business News, Breaking News, Budget 2025 Events and Latest News Updates on The Economic Times.) Subscribe to The Economic Times Prime and read the ET ePaper online….moreless
(You can now subscribe to our Economic Times WhatsApp channel)Read More News onbajaj autohero motocorpbike makerspremium motorcyclesHero MotoCorpGST ratesBajaj AutoKTMRoyal Enfield(Catch all the Business News, Breaking News, Budget 2025 Events and Latest News Updates on The Economic Times.) Subscribe to The Economic Times Prime and read the ET ePaper online….moreless
