Post-GST, India wants bigger cars: 79% buyers upgrade, EV curiosity soars
- IBEF
- October 30, 2025
A new SmyttenPulse artificial intelligence (AI) study found that India’s post-Goods and Services Tax (GST) rate cuts have sparked an ‘upgrade wave’ in the automobile market, with 79% of car buyers reinvesting their savings into premium models and add-ons instead of saving the amount. The October 2025 survey, covering buyers across tier-I, II, and III cities, revealed that 46% of respondents upgraded to larger vehicles such as compact or full-size sport utility vehicles (SUVs), while more than 60% plan to move to higher variants within the same brand. SUVs remain the most preferred category, followed by sedans and hatchbacks, underscoring a strong trend of aspiration-driven purchases rather than affordability-led decisions.
Electric vehicles (EVs) are steadily gaining traction, with 75% of respondents citing battery replacement costs and 55% highlighting inadequate charging infrastructure as top concerns. Still, 68% are motivated by environmental benefits and 66% by government incentives. Financial confidence among buyers is also rising, as 53% are now able to make higher down payments and 58% prefer loans or Equated Monthly Instalments (EMIs) with longer tenures. The study noted that GST savings, coupled with festive financing offers, are helping consumers move up the value chain, reinforcing optimism in India’s evolving auto ecosystem.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
Partners
