[anthusiast]

Opening this thread to discuss Budget 2019 updates in Automotive industry and also in general.

With an aim to become a global hub for electric vehicle manufacturing, the government has already moved GST council to lower the GST rate on electric vehicles(EV) from 12% to 5%.

Presenting the Budget for 2019-20, Finance Minister Nirmala Sitharaman said the government has already approved Rs 10,000 crore for FAME II scheme on April 1, 2019 to encourage faster adoption of electric vehicles by providing right incentives and charging infrastructure. FM also said there will be a comprehensive restructuring of National Highways Programme to ensure creation of National Highways Grid of desirable capacity.

Additional income tax deduction of Rs 1.5 lakh on the interest paid on loans for EVs

Increase in special additional duty and road and infrastructure cess on diesel and petrol by Re 1/litre

Propose to allow an additional tax deduction of Rs 1.5 lakh on interest paid on housing loans for self-occupied house owners: FM. This means those purchasing affordable house will get tax relief up to Rs 3.5 lakh on interest paid

[KL01toKA03]

The cess on fuel and the deduction for EV loans are in sync with the government's stated position regarding promoting EVs. I hope the manufacturers see the opportunity and launch competent EVs.

[sandeepmdas]

PAN is the biggest loser, along with ICE (internal combustion engine, saar) powered vehicle makers. I am waiting for what Rahul has to say.



Rahul Bajaj, I mean.

[Garth]

The government's intent with regards to EVs is clear. IT exemption on loans, reduction in duty on EV parts.

But no decent EVs (with decent range) available. Time for the manufacturers to get their act together.

[vinaydas]

No real incentives for the bleeding auto industry.
Regarding reduction of GST on EV's . Would a manufacturer pump 3000 to 4000 crores in setting up an EV plant into an industry which has 35,000 crores worth of unsold inventory ?

We are at least 5 years away when it comes to having good EV cars (no the New Tigor doesnt count, im talking more like a car with at least 300 -350 KM range) in India and at least 15 years away with regards to having an EV infra like the ones in USA or China.

[Reinhard]

Originally Posted by vinaydas

No real incentives for the bleeding auto industry.
Regarding reduction of GST on EV's . Would a manufacturer pump 3000 to 4000 crores in setting up an EV plant into an industry which has 35,000 crores worth of unsold inventory ?

We are at least 5 years away when it comes to having good EV cars (no the New Tigor doesnt count, im talking more like a car with at least 300 -350 KM range) in India and at least 15 years away with regards to having an EV infra like the ones in USA or China.

Yeah the auto industry is going to be really disappointed although not surprised. I don't think anyone expected any relief. It was needed though, maybe for 1-2 years only. To give some breather to the auto sector. It has a lot of jobs at stake in the supply chain right to the showroom and workshops.

Some GST relief would have helped.

In the long run & big picture though - there certainly needs to be a drive to reduce ICE vehicles and in that way the budget makes a positive attempt. Its more of a reminder to the auto industry that just trying to make money with existing infrastructure by selling same old ICE based cars is not going to be tolerated for long. Now is the time to start investing big in EV manufacturing, to start seeing its real results 5-6 years down the line on the roads.

[anthusiast]

More info on tax deduction on Home Loan interest payment:
- This benefit will be available for home loans taken up to March 31, 2020..
- This will be applicable for homeloan value up to ₹45 lakh.
- Currently, interest paid on home loans qualify for ₹2 lakh deduction.

[Garth]

Originally Posted by Reinhard

Some GST relief would have helped.

GST relief is there, but only on EVs from 12 to 5%. I think the message is clear to the manufacturers to start investing in EV technology. Research, reinvest whatever you do, get usable EVs into the market.


Hopefully if they removed the import duty on EVs completely that would have let the Teslas and their likes roll in.

[sandeepmdas]

Originally Posted by vinaydas

Would a manufacturer pump 3000 to 4000 crores in setting up an EV plant into an industry which has 35,000 crores worth of unsold inventory ?

The answer is yes. This is a turning point in the industry. This situation is very much like the moment in the movie the Godfather when the Don is hospitalized. If you have the guts, money and tech, time is now to kill the bigwigs.

Samsung/LG used the situation and ended the dream run of Sony and its Trinitron CRT picture tube. Android handset makers did the same and pulled king Nokia down. And now uber /ola is doing something similar...

Just my opinion.

[GrammarNazi]

₹2 increase in Fuel. Ouch.

The auto industry generates huge amount of indirect employment. Owning a car seriously punishes citizens with all kinds of taxes & associated costs.

[rajshenoy]

Not an expert here but do we have any regulations on size and power of EV ? like our sub-4m cars and engine size limits ?

If all the EV are placed at flat 5%, It might see a strong push on the premium EV as the costs will eventually offset.

[vsrivatsa]

Originally Posted by anthusiast

More info on tax deduction on Home Loan interest payment:
- This benefit will be available for home loans taken up to March 31, 2020..
- This will be applicable for homeloan value up to ₹45 lakh.
- Currently, interest paid on home loans qualify for ₹2 lakh deduction.

Is it value of the Home itself or Home Loan Value? If it is value of the Home itself - then does it include the registration as well?

[vinaydas]

Originally Posted by sandeepmdas

The answer is yes. This is a turning point in the industry. This situation is very much like the moment in the movie the Godfather when the Don is hospitalized. If you have the guts, money and tech, time is now to kill the bigwigs.

Samsung/LG used the situation and ended the dream run of Sony and its Trinitron CRT picture tube. Android handset makers did the same and pulled king Nokia down. And now uber /ola is doing something similar...

Just my opinion.

Michael Corleone pretty much killed the competition which tried to take over his fathers business when he was sick

Tesla's burn rate is 3.6 Billion $ per year and every fortnight you hear news about Tesla going bankrupt. Only the bigger car companies (Market cap > 100 billion $ : Say Toyota, VW or Daimler) will survive this onslaught.

[volkman10]

Petrol, diesel get dearer by Rs 2 a litre, following a duty hike proposed in the budget.

[BeantownThinker]

I say good times have begun for EVs in India. GST reduced from 12% to 5% and interest on loan taken will get tax benefit of upto Rs. 1.5 lakhs.

Sad part is we currently have only the Mahindra E2O to consider. It remains to be seen which manufacturer will make the first move. Efforts have been made to create demand for EVs. Now, I hope the government shows the same kind of pace and urgency in creating the infrastructure as well. Only then will the aim of going all electric by 2030 be fulfilled.

Apart from this, the budget was a bit meh.