Appliance Makers Slash Prices Ahead of GST Change in India

Leading appliance manufacturers in India have significantly reduced prices for room air conditioners and dishwashers as part of the implementation of new Goods and Services Tax (GST) rates. The price cuts, which range up to ₹4,500 for air conditioners and up to ₹8,000 for dishwashers, will take effect on September 22, 2023. This initiative aims to pass on the benefits of the reduced GST rates to consumers and stimulate sales during the upcoming festival season, particularly with Navratri approaching.

Several prominent companies, including Voltas, Daikin, Godrej Appliances, Panasonic, and Haier, have already announced their revised price lists. The GST Council recently decided to lower the tax on air conditioners and dishwashers from 28 percent to 18 percent, prompting these manufacturers to act swiftly.

In anticipation of a surge in consumer demand, manufacturers and their dealers began pre-booking units at the new lower prices. Early responses from consumers have been positive, suggesting a strong market interest in these products. In addition to room air conditioners, companies are also extending the GST benefits to various models, including variable refrigerant volume (VRF) air conditioners and light commercial units.

Godrej Appliances has adjusted its maximum retail prices (MRP) for cassette and tower air conditioners, reducing prices between ₹8,550 and ₹12,450. The company has also cut prices for split AC inverters by ₹3,200 to ₹5,900. Haier has introduced a price reduction on its Gravity model, with the MRP for the 1.6-ton inverter AC falling by ₹3,905 to ₹46,085, while its Kinouchi AI model sees a drop of ₹3,202 to ₹37,788.

Among other manufacturers, Voltas has lowered the MRP of its fixed speed window AC from ₹42,990 to ₹39,590 and its inverter window AC from ₹46,990 to ₹43,290. Daikin has similarly reduced prices; for instance, its 1.0-ton 5-star inverter split AC now costs ₹18,890, down from ₹20,500. The company has also adjusted prices for larger models, with reductions of up to ₹8,220 on specific units.

LG Electronics has cut prices for its entry-level 1-ton 3-star inverter split AC to ₹32,890, extending a GST benefit of ₹2,800. The MRP for its 1.5-ton inverter split AC has been reduced by ₹3,600 to ₹42,390, and 2-ton split AC prices have dropped by ₹4,400 to ₹55,490. Panasonic India has also made significant adjustments, reducing prices for its 1.5-tonne window AC to a range starting from ₹42,000, down from ₹45,650.

Dishwasher manufacturers are not lagging behind, as they have also lowered prices in line with the new GST rates. BSH Home Appliances, a leader in the dishwasher sector, has reduced prices by up to ₹8,000. From September 22, its entry-level model will be priced at ₹45,000, down from ₹49,000, while the top-end model sees a reduction of ₹8,000, bringing its price down to ₹96,500 from ₹104,500.

Additionally, Voltas Beko, a joint venture between the Tata Group and Turkey’s Arelik, has reduced the price of its entry-level dishwasher to ₹23,390 from ₹25,990. This strategic move is expected to broaden the market reach of dishwashers, making them more accessible to urban consumers.

The overall price reductions reflect a proactive response by manufacturers to capitalize on changing tax regulations while enhancing affordability for consumers. Industry experts anticipate that these changes will lead to a significant increase in sales, particularly during the festive season, as consumers take advantage of the new pricing structure.