Few months ago, Mahindra and Mahindra annouced that it was working on reducing ground clearance of its UVs to get excise duty benefits. The 2013 Union Budget has hiked excise duty on SUVs from 27% to 30%.. The criteria for the definition of SUV is: Vehicles measuring more than 4 meters in length, having engine capacity of more than 1500cc and ground clearance more than 170mm, will be classified as SUVs. All Mahindra UVs such as Bolero, Scorpio and XUV 500 were classified as SUVs due to this criteria. So, their prices were hiked due to the higher excise duty.
Earlier we also reported that the easiest way to get this excise duty benefit for Mahindra is to reduce ground clearance, and that Mahindra was all set to introduce a ‘Stone Guard’ on its range of UVs. Well, our scoop is now official as Mahindra has just introduced a ‘Stone Guard’ under the XUV500’s engine. to protect the SUV from uneven roads. This stone guard has reduced the XUV500’s ground clearance to 160mm, from the previous 200mm.
With the reduced ground clearance, the XUV500 will no longer attract excise duty of 30%. The SUV will be cheaper by Rs. 27,000 for W6 model and Rs. 33,000 for W8 top end model. The new set of XUVs which are cheaper due to this excise duty benefits have already been dispatched to dealers and deliveries will commence from next week. Mahindra expects sales to rise by 10-15%. The earlier 30% excise duty was affecting sales of the XUV500, as reported by EconomicTimes. Going forward, Mahindra will also introduce a similar ‘Stone guard’ to the Bolero and Scorpio SUVs.
Dr. Pawan Goenka, president of Mahindra & Mahindra said,
The reduced ground clearance of the XUV does in no way affect the ride and handling of the vehicle. On the contrary, it has become more robust. We are evaluating whether the changed parameters can be applied to other vehicles. We are looking at the feasibility of a smaller power train for the Bolero, but that would take a minimum of 18 months to develop. The Scorpio is a power and performance-driven vehicle, and there is no way that we will look at a lower power train for it. We may consider a lower ground clearance for the Scorpio as well.