Taking advantage of the government's GST rate cuts, people not only bought cars in large numbers during the festive season, but also used the discount to purchase better and upgraded models. A study conducted by market research platform SmittenPulse AI shows that the GST rate cuts led buyers who had previously planned to purchase smaller cars to purchase sports utility vehicles (SUVs) during the festive season.

Furthermore, despite infrastructure deficiencies, environmental awareness is driving the rapid increase in people's interest in electric vehicles. According to the study, approximately 79% of respondents said they are using GST savings to purchase higher-end models, better brands, or premium add-ons. Over 60% purchased upgraded models of their favorite brands. 46% purchased larger-sized cars like SUVs instead of hatchbacks.

The study stated that the GST reduction boosted vehicle demand during the festive season. Customers chose to purchase premium cars rather than take advantage of the reduced vehicle prices due to the tax cut. This led to the highest sales of SUVs during the festive season.

This study, which examined car buying behavior after the GST reduction, is based on interviews with over 5,000 people in large, medium, and small cities across the country.

The study claims that environmental awareness is also driving a rapid increase in interest in electric vehicles (e-vehicles). 67 percent of respondents said they wanted to purchase an EV despite the high cost of battery replacement and other concerns. Swagat Sarangi, co-founder of SmittenPulse AI, said the GST rate reduction has played a role in more than just making cars affordable.