Buyers upgrades EV choices as GST relief boosts festive sales: Study

GST cuts on cars have fueled festive season sales, however, nearly 80% of buyers used the tax relief to upgrade to higher models, better brands, or premium features instead of saving, a study by Smytten Pulse AI has found. The report added that SUVs remain the preferred choice, while rising environmental awareness is prompting more consumers to consider EVs despite infrastructure challenges.

The study titled 'Post GST Car Buying Behaviour trends' took a sample size of more than 5,000 people from Tier 1, 2 and 3 cities and concluded its results in October 2025. 

Citing the study, Economic Times reported,  "GST cuts have acted as a catalyst, but the larger story is behavioural: buyers are upgrading, not downsizing. Nearly 79 per cent of respondents said they are using GST savings to switch to a higher model, better brand, or premium add-ons, rather than saving the difference." 

According to the report, 46% of respondents have already advanced to a larger vehicle category, such as SUVs or hatchbacks, and over 60% intend to upgrade to higher variations within the same brand.

SUVs are the most popular new purchase, and EV consideration is rapidly increasing due to environmental consciousness. Meanwhile, as per 67% of respondents, ecological benefits drive EV interest despite battery issues and high replacement costs.

Further, more buyers (53%) are willing to make larger down payments or take out longer loan terms, indicating a clear recovery in financial confidence. The study also found that optimism is maintained by faith in industry incentives and policies.

Swagat Sarangi, cofounder, Smytten PulseAl, said, "GST cuts have done more than make cars affordable, they've reignited aspiration. The middle-class buyer is using this moment to stretch upward, from base variants to top trims, from budget brands to feature-rich models." ET reported.