Volvo To Bring Hybrid, Electric Vehicles In India After Global Launch

The carmaker is excited to say good bye to petrol and diesel powered vehicles but in the same time raises concern over the high GST rate on hybrid vehicles

Swedish auto giant Volvo Cars recently announced to ditch fossil fuel powered passenger vehicles by the year 2019 and manufacture only electric and hybrid power four-wheelers.

Speaking on the development, Tom von Bonsdorff, Managing Director, Volvo Auto India said that fully electric car from Volvo will be launched in 2019 globally and eventually hit Indian roads.

"We will try to bring them as soon as possible in India after the global launch", Bonsdorff said on Tuesday (July 12) while launching all-new version of its crossover model V90 Cross Country priced at Rs 60 lakh (ex-showroom).

Volvo had announced that it would launch five fully electric cars between 2019 and 2021, three of which will be Volvo models and two high performance electrified cars from the stable of its performance car arm, Polestar.

The luxury carmaker has set a target to sell 1 million such cars by 2025.

The carmaker also raised disconcert over the GST rate set for hybrid cars. “I am disappointed of course, that tax on hybrid cars under GST is very high. I would hope that the Indian government would revisit the rate and take down the taxation for hybrids as well,” Bonsdorff said.

Despite a hike in tax rate, the luxury carmaker will continue to sell hybrid cars in India. "The decision does not change our commitment to eco-friendly vehicles and to develop hybrid and electric vehicles," he said.

Under the new tax regime, hybrid vehicles are on the same slab as luxury cars at 28 per cent GST plus 15 per cent cess at present. At 43 per cent, total tax incidence on these vehicles is higher from the previous effective tax rate of 30.3 per cent.

Volvo also said that the company is happy with the government’s decision to make only electric vehicles from 2030 and the rates set for electrical vehicles under the GST regime.

Bonsdorff said, “The government's plans to have an all-electric car fleet by 2030 goes in hand with Volvo Cars' global vision. We are looking forward to that direction.”

The carmaker which had announced to start local assembly facility in India said that model XC90 will be its first ‘made in India’ car.