Following Mahindra’s recent announcements of significant price reductions on its SUV lineup, Skoda India has now joined the trend by slashing prices across its model portfolio by up to ₹5.8 lakh, effective from September 22, 2025.
This move comes in response to the revised Goods and Services Tax (GST) rates implemented by the government, which aim to lower the tax burden on vehicles and make owning a car more affordable for Indian consumers.
This article takes an in-depth look at the new Skoda price cuts, the models receiving the biggest discounts, how the recent GST reforms impacted car prices, comparisons with Mahindra’s reductions, details of special offers for buyers, and what these changes mean for the automotive market in India.
GST Rate Changes Driving Price Cuts
The government introduced a new GST slab structure for automobiles in 2025, reducing rates significantly on many categories:
- Small cars now attract 18% GST without cess, down from a combined rate of 28% plus up to 1% cess.
- Larger cars with engine capacity up to 1,500cc now attract a flat 40% GST, down from 45-50% including cess.
- SUVs above 4 metres with engines exceeding 1,500cc also come under a 40% GST slab, down from 50% previously.
As these revised GST rates take effect, automakers like Mahindra and Skoda are passing on full tax benefits as price reductions, making cars more accessible and stimulating demand.
Skoda Price Reductions: Model-wise Details
Skoda’s line-up benefits from upfront discounts ranging between ₹63,000 to ₹5.8 lakh depending on the model and variant. Here’s a detailed breakdown:
| Model | Typical Price Range (₹ Lakhs) | Max Discount (₹ Lakhs) | New Price Range (₹ Lakhs) |
| Skoda Kodiaq | 46.89 – 49.24 | ₹3.28 lakh | 43.61 – 45.96 |
| Skoda Kylaq | 8.25 – 13.99 | ₹1.19 lakh | 7.10 – 12.80 |
| Skoda Kushaq | 10.99 – 19.09 | ₹0.65 lakh | 10.34 – 18.44 |
| Skoda Slavia | 10.49 – 18.33 | ₹0.63 lakh | 9.86 – 17.70 |
The flagship premium SUV Kodiaq witnesses the steepest reduction, slashing prices by over ₹3 lakh, a move that significantly lowers the entry cost in the large luxury SUV segment. Meanwhile, Skoda’s compact SUVs Kylaq and Kushaq, which appeal to the younger, urban demographic, see generous cuts, enhancing their competitiveness.
Mahindra Price Cuts: Overview and Comparison
Mahindra has passed on GST benefits across its ICE SUV portfolio with reductions ranging typically between ₹74,000 and ₹1.56 lakh, depending on the model and fuel variant.
| Model | Max Discount (₹ Lakhs) |
| XUV3OO Diesel | 1.56 |
| XUV700 | 1.43 |
| Thar (Diesel) | Up to 1.35 |
| Scorpio-N | 1.45 |
| Bolero / Neo | 1.27 |
While Skoda’s largest price drop surpasses some Mahindra models due to higher GST adjustments on luxury SUVs, Mahindra’s volumes and wide rural appeal keep it a dominant player.
Special Offers and Booking Incentives
Both Skoda and Mahindra have coupled price cuts with attractive festive or launch offers:
- Skoda: Additional booking discounts of up to ₹2.5 lakh available until September 21, 2025, on select models. Exchange bonuses and easy finance schemes improve affordability further.
- Mahindra: Cashbacks, no-cost EMI options, and free first-year servicing for early buyers.
These offers create lucrative purchase windows for consumers weighing options in the SUV space.
Impact on the Indian Auto Market
The price reductions are expected to:
- Boost sales volumes as affordability improves after GST adjustments
- Intensify competition among SUVs in both compact and luxury segments
- Help first-time car buyers and middle-class families upgrade to feature-rich SUVs
- Put pressure on other OEMs like Tata, Hyundai, and Maruti Suzuki to offer competitive pricing and incentives
Analysts believe the GST-driven price cuts combined with festive offers will kickstart a strong selling season through late 2025.
Summary Table: Car Price Reductions Post-GST Revision (Effective September 22, 2025)
| Brand | Max Price Cut (₹ Lakhs) | Key Models Impacted |
| Skoda | 3.28 (Kodiaq) | Kodiaq, Kylaq, Kushaq, Slavia |
| Mahindra | 1.56 | XUV3OO, Scorpio-N, Thar |
| Tata | 1.45 | Nexon, Harrier |
| Hyundai | Approx. 1.0 | Creta, Tucson |
Conclusion
The combined price slashing by Skoda and Mahindra in 2025, fueled by GST reforms, translates to car prices cheaper by up to ₹5.8 lakh in India’s SUV segment. Consumers stand to benefit from greater affordability, better financing, and exciting offers as automakers pass on tax benefits aggressively.
Buyers planning to invest in a new vehicle have a golden opportunity to purchase feature-loaded SUVs with attractive finance options and significant price cuts, driving a likely surge in market activity for the latter half of 2025.
FAQs
1. What is the biggest price cut announced by Skoda in 2025?
Up to ₹3.28 lakh reduction on the Skoda Kodiaq luxury SUV.
2. Which Mahindra SUV gets the highest discount in 2025?
The XUV3OO Diesel model gets up to ₹1.56 lakh off.
3. Are these price cuts permanent or temporary?
Cuts reflect GST reforms effective from September 22, 2025, with some promotional discounts valid till September 21.
4. Can I avail additional discounts or finance schemes?
Yes, both automakers offer cashbacks, exchange bonuses, and easy EMI options.
5. How does the GST change impact car pricing generally?
GST rate lowering from nearly 50% to 40% or 18% (depending on size and engine) reduces tax component substantially, allowing OEMs to drop base prices.