India’s auto sector witnessed a week packed with high-stakes policy changes, bold corporate launches, and court rulings on key issues.
07 Sep 2025 | 3329 Views | By Darshan Nakhwa
The first week of September was a defining one for India’s mobility and manufacturing ecosystem, combining sweeping policy reforms with bold corporate moves
At the centre of the action was the GST Council’s historic restructuring of tax slabs for automobiles, slashing levies on small cars, two-and three-wheelers, commercial vehicles ...
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The first week of September was a defining one for India’s mobility and manufacturing ecosystem, combining sweeping policy reforms with bold corporate moves
At the centre of the action was the GST Council’s historic restructuring of tax slabs for automobiles, slashing levies on small cars, two-and three-wheelers, commercial vehicles and farm equipment while sharply raising duties on premium motorcycles.
The move, timed ahead of the festive season, promises to reset affordability for mass-market buyers, revive rural demand, and realign the economics of India’s auto sector. Yet, the transition has also sparked friction, with car dealers warning of inventory losses and premium players staring at costlier imports.
Corporates, meanwhile, doubled down on growth bets. Maruti Suzuki unveiled Victoris, its first hybrid SUV under the Arena brand, while reaffirming its commitment to both small cars and SUVs as twin pillars of future strategy.
TVS celebrated 20 years of Apache with special editions and expansion plans, while also positioning the NTorq 150 at the heart of India’s fast-growing sporty scooter wave.
French automaker Citroën mapped out a scale-up, Stellantis executives highlighting a clear path to doubling volumes, while construction equipment leaders Ammann and Sany warned that India’s CE boom must be anchored in stronger ecosystems of scale, skills, and sustainability.
Amid these moves, auto component giant Motherson Group unveiled its audacious “Vision 2030”, targeting $108 billion in revenue by the end of the decade, a near fourfold jump from FY25 levels, anchored in diversification, acquisitions, and its “3CX10” principle of de-risking exposure.
The week also brought a wave of global developments: Vietnam’s VinFast made its India debut, Tesla prepared to deliver its first Model Y units. Volkswagen consolidated its tech operations into its largest global digital hub in India, and Renault announced a sweeping management shake-up under its new CEO.
The Supreme Court delivered two landmark rulings–upholding the rollout of E20 ethanol petrol despite concerns and exempting unused vehicles from motor tax–adding clarity to key regulatory debates.
Here’s the detailed round-up of all major developments this week:
INSIGHTS FROM CORPORATES
Maruti Suzuki Bets on Victoris to Expand SUV Play
Positioned as a flagship under the Arena channel, Victoris will complement the Nexa-sold Grand Vitara, giving Maruti Suzuki a dual offering in the mid-size SUV space — the fastest-growing and most competitive segment in the Indian passenger vehicle market.
👉 Suzuki Japan to Channel More Exports Through India
Small Cars Are Our Core, We'll Have More Of Them In Future, Says MSIL MD
“We like small cars,” said Hisashi Takeuchi, Managing Director & CEO, Maruti Suzuki India. “SUV is a big market, 55%. So we have to have products. But we believe small cars in India will continue, and we will keep introducing them, including new models. This is the base of our business.”
SUVs Top Priority, Says Maruti CEO
SUVs currently account for 28 percent of Maruti Suzuki’s overall sales. The company already leads in the compact SUV segment with the Brezza and Fronx, but now wants to challenge Hyundai’s Creta in the mid-size SUV category, which makes up nearly 9 lakh units annually, or about 40 percent of the SUV market.
“The priority now has to be given to SUVs. Because if we have 20 plus models in the mid-size SUV segment and almost 20 models in the compact SUV segment, that is our priority. Now we have to fix this problem quickly,” Takeuchi said.
Motherson charts $108 billion Vision 2030, targets 33% CAGR through diversification and acquisitions
The strategy hinges on aggressive diversification and strategic acquisitions, positioning Motherson not just as an automotive component supplier, but as a multi-industry player navigating the complexities of modern manufacturing.
The company management, while highlighting the Vision 2030 indicated it as an effort to fortify diversification through its "3CX10" principle, ensuring that no single country, customer, or component contributes more than 10% of total revenues.
TVS Apache Turns 20, Eyes Premium and Global Push
From its debut in 2005 as a track-inspired street bike to becoming a global name with over 6.5 million riders across 80 countries, Apache today stands as a symbol of performance and racing.
"It's rare to see a brand sustain momentum over two decades. Apache has evolved into a global phenomenon and proudly reflects its Indian origins," said Gaurav Gupta, President, India two-wheeler business, TVS Motor.
To celebrate 20 years of the Apache brand, the company launched special anniversary editions of its RTR and RR series, alongside upgraded 4V variants of the RTR 160 and 200.
Looking ahead, TVS sees Apache entering its third decade with renewed confidence and potential entry into higher-capacity segments. The company also sees fresh tailwinds at home, with GST reforms expected to boost demand during what could be one of the most buoyant festive seasons in recent years.
TVS Motor Bets on NTorq 150 to Ride the Sporty Scooter Wave
With scooters increasingly becoming the vehicle of choice for younger, urban riders, the company sees sporty scooters as a long-term growth engine that will not only strengthen its leadership in the segment but also draw buyers from other segments.
“Two-wheeler industry over the last three years has a CAGR of 2%, scooters has a CAGR of 6% and sporty scooter has a CAGR of 11%, so scooters grew at 3x the rate of two-wheeler and sporty scooter grew at 2x the rate of scooters,” said Aniruddha Haldar, SVP, Head of Commuter & EV Business and Corporate Brand & Media.
“The sporty scooter industry has been a significant presence driving growth for the scooter industry and two-wheelers overall. Hence, our focus on space is warranted.”
Citroën Targets 2,000 Monthly Sales in India, Plans to Double Volumes in FY26
The French brand, which entered India just a few years ago, believes its growing product portfolio, expanding retail footprint, and localised marketing efforts have now created the right environment to scale up in one of the world's most competitive car markets.
"At this point, the heroes are set up, the environment is created, and it is time for customers to experience the brand," said Shailesh Hazela, Managing Director and CEO, Stellantis India. "Our immediate milestone is 2,000 sales a month. Once we cross that, growth momentum will follow."
Local Price, Global Quality: CASE Bets on India for Growth
Puneet Kumar Vidyarthi, Head of Brand Marketing, APAC and India said, “There are months where the number of machines exported are more than what we have sold in the domestic markets. What it brings to the table is scale and the confidence of our global customers, which starts from our internal teams as well,” he said.
India Must Build Its Own Ecosystem for Construction Equipment: Ammann India’s Sundaresan
“If you include unorganised players in concreting and asphalt equipment, India’s construction equipment industry produced and sold nearly 150,000 units last year. That is a big number, but still only a step towards the $25 billion target by 2030,” Sundaresan said at Autocar Professional’s Construction Equipment Inner Circle, a CXO Roundtable hosted by ZF Group.
For him, the real challenge is not in selling more equipment but in creating the industrial backbone that makes such growth self-sustaining.
Building Scale, Skills and Sustainability Key to CE Industry Growth: Sany India’s Jain
Speaking at Autocar Professional’s Construction Equipment Inner Circle, a CXO Roundtable hosted by ZF Group, Jain–Head of Key Account Business and Business unit Head, Access Business–drew on Sany’s own experience of setting up shop in India to make a larger case for how the sector can evolve.
Jain said that global peers offered both inspiration and cautionary tales. European and Japanese majors, he observed, struggled to sustain operations in India, weighed down by the market’s sensitivity to costs and its unique operating conditions.
3M bets big on aftermarket car care in India
Few companies have had a ringside view of this evolution like 3M India, which has been synonymous with car care for more than two decades.
In an exclusive interaction with Autocar Professional, Amlendukumar Singh, Vice President, 3M India, said that the shift is driven by an increasingly informed and aspirational customer base.
“People today research extensively before purchasing a car and accessories. They come prepared, knowing what they want even before stepping into a store. This helps us because our legacy, reach, and assurance resonate with such customers,” he adds.
OTHER UPDATES
Tata Motors Reports Global IT Security Incident at JLR Operations
The disclosure contained a brief statement from JLR: "We are working at pace to resolve global IT issues impacting our business. We will provide an update as appropriate in due course." The company has not provided specific details about the nature or scope of the incident.
JLR operates a complex global IT infrastructure spanning 128 sites worldwide. The company has undergone significant digital transformation through strategic partnerships within the Tata Group ecosystem.
VinFast Kicks Off India Journey with VF6 and VF7; Prices Start at ₹16.49 Lakh
Vietnam’s biggest car brand, with a 36% market share, says India is an essential market for its global expansion. “This is a milestone in our extraordinary journey of belief—that premium e-mobility should be accessible to everyone,” said Pham Sanh Chau, CEO of VinFast Asia.
“For us, India is not just another market, but essential to our mission. With its scale, India can lead the global electric revolution.”
Both models come with a 10-year / 2 lakh km warranty on the vehicle and battery pack, free charging until July 2028, and three years of free maintenance, to woo Indian buyers.
VinFast emphasized that its India strategy goes beyond simply selling cars. “We have a customer-first approach, which involves adapting to local norms and expectations. We will also focus on building a robust charging and after-sales infrastructure,” he adds. The company plans to expand into 27 major cities with 35 showrooms by end-2025.
Tesla Model Y India deliveries to commence this month
According to people familiar with the matter, Tesla plans to deliver between 350 and 500 units this year, well short of its original target of fully utilising its 2,500-car annual quota.
The delivery schedule is being aligned with confirmed full payments and the company’s ability to service customers beyond its current four-city footprint.
Volkswagen Group Consolidates Indian Tech Operations Under Single Entity
The consolidation affects over 3,800 technology professionals across multiple Indian locations, making the country Volkswagen Group's largest digital partner globally.
The unified entity will work alongside the company's established IT hubs in Germany and Portugal as part of what the group calls its "One Strong Global Network" vision.
Renault Group revamps Management Structure
The most notable change involves the creation of a Chief Growth Officer position, filled by Fabrice Cambolive, who will retain his role as CEO of the Renault brand.
In this expanded capacity, Cambolive will oversee both the Renault and Dacia brands, aiming to create synergies while maintaining distinct brand identities at the national sales company level.
Moreover, the appointment represents a shift toward unified brand management while preserving individual market positioning. Cambolive will also spearhead Renault Group's international expansion efforts, with particular focus on growth markets in India, Latin America, and Korea.
Government Approves ₹1,500 Crore Scheme to Boost Critical Mineral Recycling
The scheme, running from FY 2025-26 to FY 2030-31, forms part of the National Critical Mineral Mission (NCMM) and addresses the immediate need for critical mineral supply while long-term mining operations mature. Prime Minister Narendra Modi chaired the cabinet meeting that greenlit the initiative.
Supreme Court Dismisses PIL Against E20 Petrol Implementation
The ruling by Chief Justice B.R. Gavai and Justice K. Vinod Chandran effectively validates the government's ambitious ethanol blending programme amid fierce debate over vehicle compatibility and consumer choice.
The PIL, filed by advocate Akshay Malhotra, sought to compel the Ministry of Petroleum and Natural Gas to ensure ethanol-free petrol remained available at fuel stations across India.
Senior Counsel Shadan Farasat, representing the petitioner, argued that consumers lacked choice and that many vehicles, particularly those manufactured before April 2023, were not designed for high ethanol blends, risking engine damage and reduced mileage.
No Motor Vehicle Tax If Vehicle Not Used or Kept for Use in Public Place: SC
According to media reports, the Court emphasized that the levy is compensatory in nature and directly tied to the benefit of public infrastructure such as roads and highways.
The ruling came in an appeal arising from an Andhra Pradesh High Court order, reported LiveLaw and other legal news outlets. A Division Bench of Justice Manoj Misra and Justice Ujjal Bhuyan observed that the legislature had consciously used the term “public place” in Section 3 of the Andhra Pradesh Motor Vehicle Taxation Act, 1963.
“If a motor vehicle is not used in a public place or not kept for such use, then the person concerned is not deriving benefit from the public infrastructure; therefore, he should not be burdened with tax for that period,” the judges held, as cited in reports.
Two-Wheelers Ride Festive Momentum as Carmakers Stall in August
Maruti Suzuki, Hyundai Motor India, Mahindra & Mahindra, and Tata Motors all saw shipments contract between six and twelve percent compared to a year earlier.
This downturn came despite Onam and Ganesh Chaturthi arriving earlier than usual, typically a reliable spark for showroom footfalls. Instead, the timing clashed with policy speculation. From mid-August, expectations spread that the government was weighing a cut in GST rates on automobiles from 28 percent to 18 percent.
Tractor Industry Expected to Grow 4-7% in FY2026
The growth forecast comes as the industry seeks to build on a mixed FY2025 performance. The Indian tractor industry witnessed a marginal decline of 1% in overall sales during FY2025, though recent months have shown strong recovery with July 2025 recording wholesale volumes increasing 8.0% year-on-year and retail volumes climbing 11.0% year-on-year.
GST REFORMS
GST on Small Cars, Motorcycles Slashed to 18% from 28%
GST on small cars, motorcycles up to 350cc, three-wheelers, buses, trucks, and ambulances has been reduced to 18% from 28%, Finance Minister and GST Council Chairperson Nirmala Sitharaman said after the 56th GST Council meeting. The new rates will take effect from September 22.
For the auto components sector, the Council also decided to introduce a uniform GST rate of 18% on all auto parts, irrespective of their HS codes. The agriculture sector, too, will benefit from lower levies.
Small SUV prices could go down by Rs 68,000-Rs 1.49 lakh, hatchbacks cheaper by Rs 47,000-Rs 1.38 lakh
This change directly impacts some of the most popular compact SUVs in the market, such as the Mahindra XUV300 and Tata Nexon, which now qualify for the lower tax rate. For prospective buyers who were deferring their new car purchase, this translates into significant price cuts and improved affordability.
FADA Warns of Rs 2,500-Crore Hit to Car Dealers from Cess Paid on Festive Inventory
The warning comes days after the Goods and Services Tax (GST) Council, chaired by Finance Minister Nirmala Sitharaman, slashed GST rates on small cars, two-wheelers up to 350cc, and other vehicles to 18% from 28%, while also scrapping the associated cess from September 22.
“While the recent GST cut is a fantastic initiative, the one big challenge for the auto retail fraternity is the cess amount on already bought inventory,” said Saharsh Damani, CEO, Federation of Automobile Dealers Associations (FADA).
GST on 350cc-Plus Motorcycles Hiked to 40% from 28%
“Mid-size and large cars, motorcycles of engine capacity exceeding 350cc, aircraft, airplanes for personal use… are all under 40%,” Finance Minister and GST Council Chairperson Nirmala Sitharaman said after the 56th Council meeting.
The move is significant for India’s premium motorcycle segment, which, though relatively niche in volume terms, has been expanding steadily with the rise of aspirational buyers. This category is dominated by Royal Enfield, Triumph, KTM, Harley-Davidson and others.
GST on Tractors and Tractor Parts Cut to 5%
Tractors (except road tractors used for pulling semi-trailers and having engine capacity over 1800 cc) are taxed at 5% GST. However, road tractors used for semi-trailers, with engine capacity over 1800 cc, are taxed at 18% GST. Earlier, this rate was 28%, so it has been reduced.
EXPLAINERS
Lifting Sugar Ethanol Barriers: What It Means for India's Auto Industry
This policy shift, detailed in a recent notification, could push up the automotive fuel landscape by ensuring abundant ethanol for petrol mixes, though it raises questions about vehicle performance and industry adaptations
How India’s New GST Slabs Reshape Road Freight Economics
The biggest relief has come for exporters, with the tax on multimodal logistics services cut to 5% from 12%. This will directly bring down operational costs for companies moving goods through multiple modes of transport, Crisil Intelligence stated in its impact report released on Thursday, sectors reliant on international trade such as from automotive suppliers are expected to see tangible savings on freight bills.
Third-party insurance on goods carriages will also become less burdensome, with the GST rate reduced to 5% from 12%. This will translate into lower operating costs for transporters, particularly in an environment where fuel and financing overheads remain elevated.
👉 Read more: http://bit.ly/4m2tV7C
What Ashok Leyland’s Long-Term Battery Deal Means for India’s EV Supply Chain
This exclusive long-term collaboration comes as India-China relations improve, creating opportunities for technological knowledge transfer and local manufacturing.