Listen up Potential Car Buyers! You Just Got Owned by Mr Jaitley

Saving to buy a brand new car? Well, now you have to save more.

(Image Altered By The Quint)

The 2016 budget is out and if you’ve been planning to buy a car for a long time, well, your ‘long time’ is about to get longer.

Don’t know what we are talking about? Don’t worry. We’ll simplify it for you (no promises, though).

So, here’s what the budget has in store for you, you car-lover.

Nissan India Operations President Guillaume Sicard told PTI that the cess will definitely have an impact on the prices.

We do not foresee that to be a major burden for small car buyers but the luxury cars and SUVs will feel the heat.

Guillaume Sicard, Nissan India Operations President

Oh, we are definitely feeling the heat, along with the SUVs.

Mr Jaitley referred to cars as ‘high-capacity passenger vehicles’ and ‘small cars’.

BUT, small cars can be high-capacity too. Think Mercedes A-Class, a ‘small car’ which comes with an engine capacity of 2143cc.

Or maybe Mr Jaitley meant that small cars are the ones which cost less? Less than Rs 10 lakh perhaps, since if you go above that then you get an additional 1% bump in cess.

But by that logic, the Mahindra Bolero would be a small car too.

To be specific, Mr Jaitley decided to impose 2.5 percent cess on diesel vehicles not exceeding 4 meters in length and engine capacity not exceeding 1,500cc, while ‘higher’ engine capacity passenger vehicles, SUVs and ‘bigger’ sedans were slapped a cess of 4 percent on the value of the car.

These are over and above the cess of 1 percent already levied on petrol/LPG/CNG vehicles of length not exceeding 4 meter and engine capacity not exceeding 1,200cc.

Oh yeah, they thought this through. Or did they?

The Auto industry was already under pressure with low global demands and higher investment required in the coming years to upgrade their products in order to match the government’s ambitious targets for safety and emission standards.

And now, they have to deal with the consumer’s never-ending desire for a better yet cheap(er) car.

According to PTI, auto stocks fell by 5% on Monday. And on top of all this, Mr Kejriwal also keeps coming up with his own ideas like the odd-even plan.

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So, at the end of this very long day, most of which has been spent trying to understand Mr Jaitley’s plan for the auto industry, our conclusion is – buying a car just got more expensive.