The much awaited India-EU trade deal to be announced on Tuesday, January 27 is likely bring big cheer to automobile lovers in India. Amongst other things the deal is likely to include a major reduction in import tariffs of cars made in the European Union. According to reports, the proposal is to reduce the tariffs significantly from the current 70-110 percentage to 40% which eventually could go down to as low as 10 %. 2 lakh cars annually could be allowed to reap the benefits of this deal, though EVs will not get any benefit under the FTA for the first five years.
Skoda Octavia vRS is one of the most affordable European imports sold in India.
As a result of the announcement, a slew of cars from European carmakers like BMW, Mercedes-Benz, Audi, Volkswagen, Skoda, Porsche, Lamborghini and Ferrari are likely to get cheaper in the Indian market. With increased localization and CKD operations only high end models of manufacturers’ listed above are still imported as CBUs. At the lower end models like Skoda Octavia vRS and Volkswagen Golf GTi could see a reduction in prices once the deal comes into effect.
Also Read: Import Duty On Cars Likely To Be Slashed To 40% Under India-EU FTA: Report
A lot of performance and luxury models from three major German manufacturers are also likely to get more affordable due to the pack. These include cars like the AMG G63, AMG S 63 E Performance and Maybach S-Class from Mercedes-Benz, M series cars, XM SUV and Z4 roadster from BMW and Audi Q8/RS Q8. In addition to this, popular Porsche models like 911, Panamera, Macan (ICE) and Cayenne (ICE) which are made in Europe and imported to India are also likely to benefit from the pact.
Italian supercars are also likely to benefit from the trade deal.
High-end cars from Italian supercar manufacturers could also see a price drop once the deal comes into effect. Lamborghini’s entire model range is imported from Italy which includes cars like Urus, Revuelto and Huracan. Models from Ferrari, Maserati and Volvo could also see a reduction in prices. For brands such as Tesla, it will only see benefits under the FTA after five years, if production for India shifts to the Berlin factory.