Volkswagen Leans on Festive Discounts Amid Limited GST Gains: Upto 3 Lakh Off On Tiguan, Taigun And Virtus
Volkswagen India has announced major festive discounts in September, offering buyers savings of up to ₹3 lakh across its range. The move comes as the company looks to offset the relatively modest benefit its models receive under the revised GST framework. Smaller cars from mass-market rivals have become more affordable thanks to bigger tax cuts, while Volkswagen’s larger, more premium-focused portfolio has seen only marginal relief.
The Tiguan R-Line, the brand’s flagship SUV, carries the highest discount. Buyers can avail benefits of up to ₹3 lakh, including a straight ₹2 lakh cash reduction. The SUV, which was introduced just five months ago at ₹49 lakh, remains a fully imported model. The discounts appear to be a way of maintaining momentum for the vehicle despite its higher positioning in the segment.
Benefits on Taigun and Virtus
Among Volkswagen’s volume sellers, the Taigun compact SUV is being offered with discounts of up to ₹1.55 lakh. The largest benefit applies to the Topline 1.0-litre TSI automatic variant. The sportier GT Line trim comes with a discount of up to ₹1.1 lakh, while the entry-level Comfortline variant now starts at a special price of ₹10.99 lakh, down from its earlier ₹11.80 lakh price.
The Virtus sedan is also part of the festive campaign, with discounts of up to ₹1.5 lakh on the 1.0-litre turbo-petrol Topline variant. The Comfortline entry-level model now costs ₹10.54 lakh, reflecting a reduction of just over ₹1 lakh from its standard price.
Higher-end 1.5-litre models receive lower benefits, capped at ₹90,000. These offers place the Virtus at a more competitive price point within the mid-size sedan segment, which continues to face stiff competition from both Japanese and Korean rivals.
GST Impact and Strategy
The discounts highlight the impact of India’s revised GST system on manufacturers. Under the new structure, cars longer than four metres with petrol engines larger than 1200cc or diesel engines larger than 1500cc are taxed at a flat 40 percent. While this rate is technically lower than the earlier structure of 28 percent GST plus a compensation cess of 15 to 22 percent, the overall savings for buyers of larger vehicles remain limited.
This contrasts with small cars, which have benefited significantly from the cut in GST to 18 percent from 28 percent. For brands like Volkswagen, whose lineup is centred on larger, more premium vehicles, the tax reduction alone is not enough to improve affordability. As a result, the company is leaning heavily on dealer-level incentives, cash discounts, and loyalty programs to stay competitive during the festive season.
Competitive and Inventory Pressures
The timing of these discounts coincides with the peak buying months in the Indian market. However, the scale of the offers also underlines Volkswagen’s challenge. Premium carmakers that focus on larger vehicles are less advantaged by GST changes and must create their own value through direct discounts.
Dealers are reportedly tailoring offers depending on variant and transmission choice, with automatic models often carrying higher benefits than manuals. Inventory factors are also at play, with 2024 stock seeing bigger reductions as showrooms prepare for incoming batches aligned with the updated pricing regime.
By combining GST-related benefits with additional discounts, Volkswagen aims to hold its ground in a market that has tilted toward brands with smaller, tax-favoured models. The challenge for the German automaker will be to balance long-term profitability with the need to keep its products attractive during a crucial sales period.