Prices associated with a car or motorbike that the car prices in India vary from one state to another. The basic factors that contribute to car prices in any state are ex-showroom price, ex-factory rate, and ex-road rate.
Ex Factory Price of Car :
The price Car Dealer pays to Manufacturer to lift the car from them i.e it is the price at which a car manufacturer sells the car. Ex-Factory Price Terminology is not so common as it is between the Manufacturer, Dealer.
Ex Showroom Price of Car :
Ex-showroom Price of Car is the is the price at which a car dealer sells a car to Retail Customers which includes Dealer Margins, Transportation costs and applicable Excise, State Taxes and Octroi Charges. Ex-showroom Price is called the basic price of the asset exclusive of any registration, insurance or loadings.
On Road Price :
On Road Price is the final Price payable by the customer to the car dealer and is also known as Invoice Value of the car it includes State Registration Charges, Life Time Road Tax Payment, Mandatory Insurance and the dealer handling charges (aka Logistics Charges). Also includes optional costs such as Accessories cost, additional optional warranty coverage. The discounts if any will also be shown and reduced while calculating the Net On Road Price.
Ex-road price refers to the price at which the buyer drives away the car.
Registration charges :Registration is mandatory of every new vehicle. It is a unique identity of vehicle
- Life Time Road Tax :Road tax, known by various names around the world, is a tax which has to be paid on a vehicle before using it on a public road.
- Vehicle Insurance :This is also known as auto insurance, is insurance purchased for cars, trucks, motorcycles, and other road vehicles.
- Dealer Handling Charges or Logistics charges: Dealer claims handling charges in name of taking car from warehouse to showroom.
What are Registration charges?
Registration is mandatory of every new vehicle. It is a unique identity of vehicle. Registration charges are cost to get the vehicle registered.
- All motorised road vehicles are tagged with a registration or licence number in India. The licence plate (commonly known as number plates) number is issued by the district-level Regional Transport Office (RTO) of respective states
- Plates for private car and two-wheeler owners have black lettering on a white background (e.g., TN 54 BB 0525). Commercial vehicles such as taxis and trucks have a yellow background and black text (e.g., KA 10 MA 8008). The current format of the registration index consists of 3 parts, They are
- The first two letters indicate the state to which the vehicle is registered.
- The next two digit numbers are the sequential number of a district. Due to heavy volume of vehicle registration, the numbers were given to the RTO offices of registration as well.
- The third part is a 4 digit number unique to each plate. A letter(s) is prefixed when the 4 digit number runs out and then two letters and so on.
- Registration charges differ from state to state. Within a state it differs based on cost of car, type of car (petrol or diesel)
- Registration charges for various cars in different states can be found at ipaidabribe Vehicle Registration charges.
Charges for Vehicle Registration in Major Indian Cities –
Delhi:
- Price Upto Rs. 6 Lac - Petrol Cars - 4%, Diesel Cars - 5%
- Price between 6 Lac - 10 Lac - Petrol Cars - 7%, Diesel Cars - 8.75%
- Price > Rs. 10 Lac as Ex showroom Cost - Petrol Cars - 10%, Diesel Cars - 12.5%,+ MCD Parking Charges of Rs. 2000 for cars priced under 4 Lakh and Rs. 4000 for rest of the vehicles
Uttar Pradesh: (Ghaziabad, Noida, Kanpur, Meerut, Lucknow, Saharanpur, Agra and all other cities)
- 8% of ex-showroom price. No separate classification of hatchback, sedan, petrol, diesel.
Haryana: (Faridabad, Gurgaon, Ballabhgarh)
- RTO Charges Revised from 1st April 2013
- Price Upto Rs. 6 Lac - 3%
- Price between Rs. 6 Lac - 10 Lac - 6%
- Price between Rs. 10 Lac - 20 Lac - 8%
- Price Above 20 Lac - 9%
Maharashtra: (Mumbai, Pune, Nagpur, Navi Mumbai and all other cities)
- Price < 10 Lakh - CNG @ 5%, Petrol @ 9%, Diesel @ 11%
- Price between 10 Lakh - 20 Lakh - CNG @ 6%, Petrol @ 10%, Diesel @ 12%
- Price Above 20 Lakh - Petrol @ 11%, Diesel @ 13%
- Additional Octroi @ 4.5% for cars registered in Mumbai.
Karnataka: (Bangalore, Mysore, Udupi)
- Karnataka has the distinction of highest vehicle registration charges with minimum slab starts @ 15%
- Price < 5 Lakh - 15%
- Price between 5 - 10 Lakh - 16%
- Price between 10 - 20 Lakh - 19%
- Price > 20 Lakh - 20%.
Chandigarh:
Chandigarh has the Lowest Vehicle Charges across all cities/UTs in India
- Upto Rs.6 Lakh - 2%
- Price between 6 Lakh - 20 Lakh - 3%
- Price > 20 Lakh - 4%
Gujarat: (Ahmedabad, Surat, Vadodara)
- For CBU Cars - 6%. However, in cars getting registered in company name 12%
- For CKD Cars - 12% (Imported Cars). In cars getting registered in company name 24%
What is Life Time Road Tax?
Road tax, known by various names around the world, is a tax which has to be paid on a vehicle before using it on a public road. Government charges road tax for road improvements and repairs.
- The road tax imposed is subject to state government rules, traffic regulation etc. So it differs from state to state in India.Road tax in Delhi is lesser than in Bangalore and therefore the car you buy from Delhi is priced lower than that you buy in Bangalore.Even within the state it is based on type of vehicle, cost of vehicle etc. In any state Road Tax for Maruti Swift is different from Hyundai i10, road tax for Hyundai i10 is different from Hyundai Verna and road tax for Hyundai i10 with 1.1 metallic color is different from Hyundai i10 non metallic color.
- Road tax for vehicles that cost less than Rs 4 lakh (two-wheelers and small cars) is around 4%-6% whereas it is between 7% and 9% in case of vehicles valued over Rs 20 lakh, Centre is likely to decide uniform lifetime road tax for cars, taxis and two-wheelers. The state governments have agreed to fix the tax at floor rate of 6% of the sale price before the value added tax (VAT).
- It is usually paid once in life time of the vehicle in a state hence it is called as Life Time Road Tax. But If one shifts or relocates vehicle from one state to another state in one has to re-register vehicle and pay lifetime tax again, based upon the depreciated value as assessed by RTO of the new state. The value of vehicle diminishes year after year. Once the residual value of lifetime tax is paid, it is possible of life-time tax paid in the earlier state on pro-rata basis, by writing to the earlier State’s RTO for the same. However, this is a manual process and therefore, it takes a lot of time before you actually get the refund
What is Vehicle Insurance?
Vehicle Insurance also known as auto insurance, is insurance purchased for cars, trucks, motorcycles, and other road vehicles. Its primary use is to provide financial protection against physical damage and/or bodily injury resulting from traffic collisions and against liability that could also arise there from. A Car Insurance plan is mandatory by law is compulsory for all foul wheelers. Different insurance companies provide different rates and types of insurance in different states.
What are Dealer Handling Charges?
Dealer Handling Charges or Logistics charges: Dealer claims handling charges in name of taking car from warehouse to showroom, basic fuel, the number plate charge, cleaning of car, sundry expenses as delivery charges. The amount is quiet high and ranges from Rs.6000 for a hatchback car to upto Rs. 25,000 for Luxury Segment Cars. The Amount is much dubious considering the high price paid for. However, the charges are not claimed by dealers in India, but across most of the countries in the world as Handling Fees, Documentary Fees or even Vehicle Preparation Fees.
Which price do banks consider?
When you buy a car through bank finance, these charges become important. Usually private banks give loans up to 85% of the ex-showroom price, whereas government-owned banks offer up to 85% on the on-road price. However, these limits vary from bank to bank and also depend upon the creditworthiness of a customer. But it makes a difference to person buying the car. Suppose you want to buy a car which has an ex -showroom price of Rs. 5,00,000. To insure this vehicle you have to pay Rs. 18,000, and for the road tax you have to pay Rs. 4,000. Thus the total cost of ownership of this vehicle is Ex-showroom price plus insurance plus road tax, that is Rs. 5,22,000. So, if you get a loan from bank which gives you car loan on Ex-showroom prices you will have to pay the Insurance and Road tax from your pocket. If you get an On Road Price car loan you won’t have to pay this amount, instead it will be clubbed in your car loan.
What are Dealer Handling Charges?
Dealer Handling Charges or Logistics charges: Dealer claims handling charges in name of taking car from warehouse to showroom, basic fuel, the number plate charge, cleaning of car, sundry expenses as delivery charges. The amount is quiet high and ranges from Rs.6000 for a hatchback car to upto Rs. 25,000 for Luxury Segment Cars. The Amount is much dubious considering the high price paid for. However, the charges are not claimed by dealers in India, but across most of the countries in the world as Handling Fees, Documentary Fees or even Vehicle Preparation Fees..
Which price do banks consider?
When you buy a car through bank finance, these charges become important. Usually private banks give loans up to 85% of the ex-showroom price, whereas government-owned banks offer up to 85% on the on-road price. However, these limits vary from bank to bank and also depend upon the creditworthiness of a customer. But it makes a difference to person buying the car. Suppose you want to buy a car which has an ex -showroom price of Rs. 5,00,000. To insure this vehicle you have to pay Rs. 18,000, and for the road tax you have to pay Rs. 4,000. Thus the total cost of ownership of this vehicle is Ex-showroom price plus insurance plus road tax, that is Rs. 5,22,000. So, if you get a loan from bank which gives you car loan on Ex-showroom prices you will have to pay the Insurance and Road tax from your pocket. If you get an On Road Price car loan there is no need to pay this amount, instead it will be clubbed in your car loan.
Here is how On Road Price will be calculated:
For Volkswagen Polo observation of On Road Prices on different places in India.
In Central Delhi
In Bangalore:
In Hyderabad:
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