Originally published on 30th April 2020. Reupdated on 13th Sep 2021.
Questions that are answered :
- Why German cars are expensive in India?
- Why BMW cars are expensive in India?
- Why Mercedes cars are expensive in India?
- Why Audi automobiles are expensive in India?
- Why Porsche cars are expensive in India?
- Why foreign cars are expensive in India?
4 topics on which this article is covered:
- Prices comparison of German cars in USA and India
- 3 Reasons why German cars are too expensive in India
- 3 Reasons why German cars are cheaper in the USA
- 3 Myths about German cars
- Prices comparison of German cars in USA and India
- 3 Reasons why German cars are too expensive in India
- 3 Reasons why German cars are cheaper in the USA
- 3 Myths about German cars
German cars are known for their prosperity and lavishness around the world. Germany has a long history of its German car brands. Audi, Mercedes, BMW, Porsche is German luxury car brands. Out of these brands, Audi, BMW, and Porsche are owned by Volkswagen alone.
But what is the reason for these brands are cheaper in the USA than in India? You will soon conclude it...
Price Comparison of 4 Cars In India And USA: (scroll down to know the reason)
1. Audi A6
Price in USA: Rs. 41,25,872 (Base Price)
Price in India:Rs. 54,20,000 (Base Price)
Difference: Rs.12,94,128
2. Mercedes AMG GT Coupe
Price in USA: Rs. 87,06,987 (Base Price)
Price in India: Rs. 2,19,00,000 (Base Price)
Difference: Rs.1,31,93,013 (About 1.3 crore)
3. BMW M4 Coupe RWD
Price in USA: Rs. 51,94,375
Price in India: Rs. 1,36,00,000
Difference: Rs. 84,05,625
4. Porsche Cayenne Coupe
Price in USA: Rs. 57,50,244 (Base Price)
Price in India:Rs. 1,32,00,000 (Base Price)
Difference: Rs. 72,49,756
Reason for which German cars are too expensive in India:
The most common reason is due to the high exporting charge for sure, but it should not be this much. Here, the difference in the price is over 10 lakhs (1 million), which is beyond its mean.
5 Possible reasons for which German cars are so much expensive in India:
- Preference: In India, consumers prefer expensive things rather than giving a damn about the specs and quality. Due to this, the manufacturers have got a good chance to extract more money from India.
- All imported vehicles in India (not electric vehicles) carry a GST of 28%.
- German cars are luxury, hence for the sake of comfort, almost all German cars have more than 4 metres in length. The shocking fact is that in cars with more than 4m lengths, the excise duty is increased to 20%, that is only 4% on the cars with length less than 4 metres.
- One has to pay import duties of 100% and after that, you pay GST. At last, registration tax.
- Importation: These cars are fully assembled in Germany before getting imported into India. Hence, the price increased just due to the assembling. CKD is imported into India.
- Safeguard: The government in India wanted to protect their own market so therefore they levy high taxes on these vehicles to safeguard other Indian brands like Mahindra, etc.
The last possible reason is that India is a country with more than a billion people, and due to this, the greedy manufacturer can extract a large amount of revenue from it. If German cars were to sell in India at the same price as in Germany, you may expect middle-class people roaming around with Mercedes who used to commute with Baleno Or Dzire.
3 Reasons why the US has cheaper imported German cars (even cheaper than in Germany itself!):
- Due to its very high competition in the market with other brands such as Cadillac, Lincoln, Acura.
- German cars (BMW) are in high demand in the US.
- These German brands have taken their position in such a way, that people have become loyal towards them.
3 Myths about German cars:
Myth 1. Volkswagen owns all German branded cars:
Myth 1. Volkswagen owns all German branded cars:
The fact is that Volkswagen owns the following car brand:
- Bentley
- Bugatti
- Audi
- Porsche
- Volkswagen
- Lamborghini
Myth 2. German cars are cheaper in Germany
The most ironic fact is that German cars are sold much cheaper in the USA than in Germany itself. The reason is the same, high competition and local prices.
German cars at it beginning started as Volkswagen.
German cars at it beginning started as Volkswagen.
Myth 3. German cars are easier to maintain:
German luxury cars are too expensive to maintain. The annual maintenance price is too much to be paid by the middle class in India.
This is since these luxurious cars are made to be run in Germany because about 70% of the German highways have no speed limit and you can even ride 250 km/h all day long with such an engine!
Therefore a lot of pieces are present inside the car to make it stable at such a high speed.
Conclusion: At last, cars like Toyota and Honda are also imported in India but their assembling takes place in India, therefore, making it less expensive. These brands have high customer satisfaction reports. German automobile brands are the most reliable brands because of their long history.
These cars may be expensive for people, but almost no one has a complaint against this.
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