The leading two-wheeler brands such as Hero and Bajaj have not increased the prices of their premium motorcycles due to the festive season demand
The recent GST overhaul came as a mixed package for the two-wheeler industry as the commuter motorcycles and scooters became more affordable than before due to the tax being reduced from 28 percent to 18 percent. However, the bikes with engine capacity above 350cc faced a setback as the GST was increased from existing 28 percent to 40 percent, hence by making them rather expensive. Though a few brands such as Hero, Bajaj and KTM didn’t announce a price hike for the bikes above 350cc capacity and instead absorbed this impact without passing it on to the buyers.
Now, it has been learnt that Bajaj and Hero have not increased the prices of their premium motorcycle due to the ongoing festive season. The price rise could have resulted in a subdued demand and hence volumes could have gone down even more. On the contrary, popular brands such as Royal Enfield and Ducati have decided to hike the pricing of their big bikes by a few thousands due to GST 2.0 in the country.
“The 350cc+ segment is showing a decline for us after the GST implementation as expected… mainly due to the (tax rate on) 350 minus segment going down to 18 per cent,” said an executive at a two-wheeler company. Hero-Harley’s X440 is being retailed at the pre-GSt 2.0 price and same goes for Bajaj-owned KTM’s 390cc portfolio which is being sold at the same price as before.
The recent 2025 GST reforms came into effect from Sep 22 and hence the buyers rushed to the showrooms to purchase their preferred premium motorcycles in order to escape the price hike. Hence, most of the two-wheeler brands assumed that if the price hike due to GST 2.0 is directly passed on to the buyers, then it could damage their sales prospects significantly, and hence they decided in favour of absorbing the GST impact.
“By absorbing the incremental impact, KTM has ensured that riders can continue enjoying its racing DNA on favourites like the 390 Duke, 390 Adventure, and RC 390, without any additional costs, starting this festive season,” Bajaj Auto said last week. However, all the other bikes including the 250 Duke, 250 Adventure and 160 Duke have benefitted from GST 2.0 and their prices have been reduced.
“Volumes are concentrated in the below-350cc segment, so while the increase from 28 percent to 40 percent is being absorbed, the overall impact is limited. We continue to see a very strong uptick in our higher-volume models. The sales surge, however, has brought fresh challenges. We are actually facing a shortage of trucks because of the scale of demand. Logistics has become a constraint,” said Shardul Verma, head of strategic marketing and brand at Classic Legends.
