Mahindra price cut after GST 2.0: Thar, Scorpio N, XUV700 get up to Rs 1.56 lakh cheaper

GST reset sends SUV prices tumbling, Mahindra moves first

Car prices don’t usually fall overnight. This week, they did. Mahindra & Mahindra, India’s biggest SUV maker by volume, cut sticker prices across its entire internal-combustion SUV range—by Rs 1.01 lakh to Rs 1.56 lakh—after the GST Council’s sweeping GST 2.0 overhaul for passenger vehicles. The new prices kicked in on September 6, 2025, just three days after the Council’s 56th meeting chaired by Finance Minister Nirmala Sitharaman.

Under GST 2.0, the tax bands for cars have been simplified. Smaller cars now fall under an 18% GST slab (down from 28%). Larger vehicles—those that used to draw higher tax plus cess—move to a flat 40% rate (down from 48%). Mahindra says it has passed on the full benefit to buyers. The company also estimates that over 60% of its overall volumes, including commercial vehicles, now sit in the lower 18% slab, which is where the biggest savings show up.

What does that mean for your wallet? Think of it this way: on a mainstream SUV variant that’s now cheaper by, say, Rs 1.50 lakh, a typical 5-year car loan at around 10% interest could see the monthly EMI drop by roughly Rs 3,100–3,200. And because registration tax and insurance are calculated on the ex-showroom price in most states, the on-road price can dip a little further than the headline cut. The swing varies by state, but the direction is the same—lower upfront cost and slightly easier EMIs.

The timing isn’t an accident. India’s festive season, when a large chunk of annual car sales happen, is imminent. The price reset gives fence-sitters a nudge, trims price gaps between segments, and helps Mahindra sharpen its offers against rivals. The company was among the first to flip the switch on new pricing, which also puts pressure on competitors to respond quickly.

How much each Mahindra model gets cheaper—and why it varies

Mahindra’s cuts are model-specific and, in some cases, vary by powertrain because of how GST 2.0 classifies vehicles. Here’s the model-wise snapshot of ex-showroom reductions announced by the company:

• Bolero and Bolero Neo: Rs 1.27 lakh reduction
• XUV3XO petrol: Rs 1.40 lakh reduction
• XUV3XO diesel: Rs 1.56 lakh reduction (the largest cut in Mahindra’s lineup)
• Thar 2WD diesel: Rs 1.35 lakh reduction
• Thar 4WD diesel: Rs 1.01 lakh reduction
• Scorpio Classic: Rs 1.01 lakh reduction
• Scorpio N: Rs 1.45 lakh reduction
• Thar Roxx: Rs 1.33 lakh reduction
• XUV700: Rs 1.43 lakh reduction

Why does the size of the cut change from one variant to another? It comes down to the new tax structure’s breakpoints. Smaller, more affordable models that have shifted from the old 28% slab into the new 18% slab see the biggest price drops. Larger, high-spec or off-road-focused vehicles that were taxed at the upper end earlier now fall under a flat 40% rate, which still means savings, but not as steep. That’s why the Thar 4WD diesel—sitting in a higher bracket—loses less than the Thar 2WD diesel.

If you’re tracking specific trims, Mahindra says the benefits apply across all variants of the models listed. The exact rupee cut depends on the variant’s ex-showroom price. It’s worth asking your dealer for the updated variant-wise sheet and confirming whether your booking qualifies for price protection; in many cases, open bookings get adjusted to the new ex-showroom automatically, but it’s smart to have it in writing.

Let’s break down what this means for the popular nameplates:

• Bolero/Bolero Neo: A Rs 1.27 lakh cut brings these workhorse SUVs closer to entry compact SUV pricing. For small business owners and rural buyers, that widens the appeal and may accelerate replacement cycles.
• XUV3XO: The biggest gainer. The diesel trims shed up to Rs 1.56 lakh, petrol drops by Rs 1.40 lakh. That reshuffles the value deck in sub-4m SUVs and heats up its contest with rivals that haven’t yet published new tags.
• Thar and Thar Roxx: The 2WD diesel getting Rs 1.35 lakh cheaper will tempt lifestyle buyers who were leaning toward higher hatchbacks or compact crossovers. The 4WD diesel’s Rs 1.01 lakh cut isn’t as aggressive, but it still softens the jump to the off-road hardware. The Thar Roxx, at Rs 1.33 lakh off, slots in sharply for those eyeing the newer styling.
• Scorpio Classic and Scorpio N: The Classic’s Rs 1.01 lakh cut makes it an even simpler, tougher value pitch. The Scorpio N’s Rs 1.45 lakh reduction pulls some mid variants into reach for buyers who were debating between compact and mid-size SUVs.
• XUV700: A Rs 1.43 lakh slash on a premium, tech-loaded SUV is a big nudge for families that need space and features but were wary of a 20-lakh-plus ex-showroom tag.

One more quick note: this round of reductions is for ICE SUVs. Mahindra’s EVs already benefit from a separate, lower GST regime, and there’s no change there. If you were comparing an EV against a petrol/diesel SUV, this move narrows the upfront price gap on the ICE side; running costs still favor EVs, but your break-even math will shift a bit.

What should buyers do right now? A few simple steps help you lock in value:

• Ask for a fresh quotation: Make sure the ex-showroom reflects the revised tags and check how much the on-road number drops in your state.
• Confirm booking status: If you booked earlier, ask the dealer to endorse the new price on your docket. Most do it automatically, but paperwork matters.
• Check variant availability: Price cuts can extend wait times. If your first-choice color or transmission is scarce, consider nearby dealerships or be flexible on trims.
• Re-run your loan: A lower principal often qualifies you for better terms. Even a 0.25% softer rate or a shorter tenure can save thousands more over the loan’s life.

On the industry side, the impact will ripple beyond one brand. When a market leader resets pricing, rivals don’t sit still. Expect other automakers to recalibrate tags or sweeten deals as they digest GST 2.0. You may see different strategies: some will mirror full reductions model-by-model; others might blend smaller cuts with higher-value features or exchange bonuses. Either way, buyers gain leverage in the near term.

Dealers, meanwhile, will juggle two moving parts—fresh pricing and festive demand. Lower ex-showroom rates can compress room for additional discounts, especially on fast-moving variants. But the net outlay is still lower than last week’s, and that matters more to most buyers. If you’re shopping for a slow-moving trim or an older VIN, there may still be some dealer-level bargaining room. Be polite, compare quotes, and ask about corporate, rural, or loyalty schemes that sometimes stack on top.

What about the used car market? Expect a short adjustment phase. When new car prices drop, recent-model used SUVs usually see their asking prices soften, especially for variants that overlap with new ex-showroom brackets. If you’re selling a 1–3 year-old Thar or Scorpio N, be prepared for a little more negotiation. If you’re buying pre-owned, take your time—prices often trail new-car resets by a few weeks.

Behind the scenes, the tax math is the big driver. The old regime—a 28% GST with varied compensation cess on top for bigger vehicles—made for a complicated spread. GST 2.0 tidies that into two clearer buckets: 18% for smaller cars and 40% flat for larger vehicles. The simplification cuts paperwork friction and makes pricing more predictable for both OEMs and customers. The economic effect is straightforward: lower tax on mass-market models expands the addressable pool of buyers, while a pared-back rate for larger vehicles still keeps revenue flowing without bluntly throttling demand.

For Mahindra, there’s a portfolio angle too. A substantial chunk of its sales mix sits in the sub-4m and mid-size zone, which now benefits most. That strengthens its price ladder: Bolero/Bolero Neo for value, XUV3XO for feature-rich compact buyers, Scorpio for traditional SUV needs, Thar/Thar Roxx for lifestyle appeal, and XUV700 for premium family duties. Price gaps between adjacent models narrow just enough to encourage trading up without pushing shoppers out of budget.

Will supply keep up? Mahindra has worked through long wait lists on several models over the past two years, but high-demand variants can still stretch timelines. Production planning tends to pivot fast ahead of festivals, so expect the company to prioritize top-selling trims that are now sharply priced. If you’re eyeing a specific engine-transmission combo, check live delivery ETAs rather than relying on old timelines.

A practical example helps frame the change. Suppose you were considering a mid variant of the Scorpio N with an ex-showroom price that’s now Rs 1.45 lakh lower. On a 10% down payment and a 60-month loan, your financed amount shrinks notably. Beyond the EMI drop of roughly Rs 3,100–3,200 for that reduction, your state’s registration fee—levied as a percentage of ex-showroom—also dips. Insurance, calculated on declared value, will shave off a bit too. That’s multiple line items trending down at once.

There’s also a knock-on effect on accessories and add-ons. OEM accessories often get bundled into on-road computations; with a lower base, some buyers may choose to add factory upgrades (alloy wheels, infotainment packs, roof carriers) without breaching their original budgets. If you’re tempted, compare OEM pricing with trusted aftermarket options and keep warranty implications in mind.

If you’re a fleet or small-business buyer, the calculus improves even more. Lower ex-showroom pricing on Bolero/Bolero Neo and certain XUV3XO trims helps fleet operators refresh vehicles faster, reduce financing strain, and improve total cost of ownership. Servicing costs don’t change because of tax, but faster turnover typically lifts uptime and lowers unexpected maintenance shocks on aging vehicles.

A few housekeeping points before you sign anything:

• The cuts reflect ex-showroom prices. State road tax slabs haven’t changed; they apply to the new base.
• Dealer handling charges and logistics fees should be transparent. Ask for a break-up.
• If you have an older quotation or loan pre-approval, request a revised sanction with the updated ex-showroom and on-road figures.
• Double-check VIN year and month. High-demand, newly built stock will be tighter; older VINs can sometimes bring extra dealer incentives.

For now, the headline is simple: there’s a real, immediate Mahindra price cut across popular SUVs driven by a national tax reset. It’s rare, it’s meaningful, and it arrives right when India starts buying more cars. If you were waiting, this is the moment to line up a test drive, lock your variant, and make the numbers work in your favor.