Royal Enfield announces GST-linked price cuts

In the wake of the recent announcement by Bajaj Auto about passing on Goods and Services Tax (GST) implementation benefits to its customers by slashing prices of all models across its range, Royal Enfield has jumped on the bandwagon and is set to do the same.
The Chennai-based two-wheeler maker announced that the price cuts will be applicable from June 17, well before the GST implementation on July 1, 2017. Unlike Bajaj Auto, which will be offering price cuts of up to Rs 4,500 across its entire model range (depending on state and model), Royal Enfield has refrained from stating exactly by how much it'll drop prices.

However, the slashed prices will be applicable to the company’s Classic 350, Bullet 350 and Bullet ES. This is thanks to the new GST structure in which all two-wheelers with a cubic capacity of under 350cc will attract a tax rate of 28 percent, which is currently up to 30 percent under the old tax structure. However, the new structure also states that two-wheelers with cubic capacities above 350cc will be levied additional 3 percent cess, taking their total GST up to 31 percent; this will increase the price of all motorcycles with higher engine capacities. In Royal Enfield’s context, this will mean that a majority of its models, including the Classic 500, Bullet 500, Continental GT, Thunderbird 500 and the Himalayan, will see a price hike.

Speaking about the price drop, Rudratej Singh, president of Royal Enfield, said, "We believe that GST will transform the way business is done in India, thus benefitting the economy and our customers. Royal Enfield is pre-emptively extending the GST benefits to its customers and is ready to implement the on-road price revision on purchases beginning June 17, 2017, on products where applicable.”