BMW Advocates for Maintaining 5% GST on Electric Vehicles in Upcoming Union Budget

BMW, a German luxury car manufacturer, has urged the Indian government to maintain the current 5% GST on electric vehicles (EVs) in the upcoming Union Budget. The company believes that any increase could negatively impact the industry. In 2025, BMW's electric car sales rose by over 200%, while overall sales from its BMW and MINI brands increased by 14.4% to 18,001 units.

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Hardeep Singh Brar, President and CEO of BMW Group India, expressed satisfaction with the government's economic management. He stated, "I think the government has done a fantastic job in terms of managing the overall economy and making sure that we don't drop below the 7 per cent mark, which is very crucial for the country." However, he emphasised the importance of keeping the GST on EVs unchanged.

BMW's Electric Vehicle Strategy

Brar highlighted that India's EV market share is only 4%, compared to over 10% in developed countries and 40% in China. He noted that increasing GST on EVs would be detrimental until EV adoption reaches a significant level. The high cost of EV manufacturing, mainly due to battery prices being 40-50% higher than internal combustion engine (ICE) vehicles, further supports this stance.

The company plans to introduce three new electric car models this year, aiming to boost its EV penetration to around 25%. Brar mentioned that if overall growth exceeds 10%, electric vehicles could see strong double-digit growth. In Q4 of last year, BMW's EV penetration reached 23% due to improved supplies.

Sales Performance and Future Plans

In 2025, BMW Group India sold a total of 23,842 vehicles, including 17,271 BMW units, 730 MINI cars, and 5,841 motorcycles. The long wheelbase models performed exceptionally well with a year-on-year growth of over 162%, contributing to half of BMW's sales compared to 29% previously.

The company's SUV sales also grew by over 22%, reaching 10,748 units. The BMW R 1300 GS Adventure and BMW S 1000 RR motorcycles bolstered their motorcycle segment. Brar attributed continuous sales growth to frequent model refreshes and network upgrades.

Expanding Retail Network

BMW is expanding its retail presence into smaller towns across India. Currently operating in 40 cities with about 100 touchpoints, the company plans to add ten more cities next year. Brar stated that they are investing Rs 400 crore in the Retail.next project with dealers to offer BMW, MINI, and Motorrad products under one roof.

The MINI brand saw success with its convertible version launched in December. All units were sold within the first month. This year, BMW plans to launch ten new products or special editions under MINI and aims to double its volumes by 2026.

Brar concluded by noting that BMW has been growing at a rate of 13-14% since the pandemic began. This growth rate is more than double the industry's average of around 5-6%. He remarked that about one-third of last year's total sales occurred during the festive season in December.

With inputs from PTI