Buying diesel SUVs and strong hybrid cars in the country will be expensive. This is due to the increase in effective import duty on platinum from 6.4% to 15.4%. This will affect those vehicles in which precious metals are used to control pollution. Auto companies can pass the burden of increased costs directly on to customers. Due to this, the prices of mid-size diesel SUVs may increase by Rs 12 thousand and the prices of strong hybrid cars may increase by Rs 18 thousand. Entry-level petrol cars can also be expensive by up to Rs 4 thousand. Platinum is used in vehicles to meet BS-6 standards. According to Randhir Singh, former director of NITI Aayog, increasing the duty on platinum will increase the cost of following pollution rules. Companies like Tata Motors will be most affected. Mahindra’s expenses will increase on models like Scorpio-N, Thar, XUV-700. The cost of strong hybrid cars of Toyota and Maruti will also increase. In hybrid vehicles the engine starts repeatedly. Their filters contain more platinum. Platinum is consumed more in heavy vehicles. Platinum is used in engines to prevent pollution. Its high quantity in heavy vehicles will have the biggest impact on their manufacturing cost. Vehicle Categories – Platinum Consumption Commercial Vehicles – 20+ Hybrid Cars – 10-15 Medium Diesel SUVs – 6-10 Petrol Cars – 2-4 (Figures in grams) Relief – Cheap platinum will be obtained from old silencer. There will be only 7.5% tax on foreign platinum for silencer filters. The government has now reduced the tax on importing old and defective filters from abroad to 4.35%. It would be cheaper to remove the platinum from a damaged silencer and reuse it. This decision will promote recycling in the country. However, due to platinum becoming expensive, vendors will now charge higher prices from auto companies. Effect – Customer interest in EV may increase. Demand for electric cars may increase due to platinum becoming expensive. These do not require catalytic converters for pollution control. Companies can also increase focus on hydrogen technology. With increasing research, these cars may become cheaper in future. Companies are still assessing the impact of the duty increase.
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Import duty on platinum doubled: Prices of diesel, hybrid cars may increase by up to Rs 18 thousand
