Mahindra SUV price cut: Up to Rs 1.56 lakh off after GST 2.0 rate drop

9 September 2025

By Aarav

Sticker shock, but the good kind. Mahindra has slashed ex-showroom prices across its entire ICE SUV lineup by Rs 1.01–1.56 lakh, effective immediately, after the government’s GST 2.0 rejig on automobile tax slabs. If you were eyeing a Thar, Scorpio, Bolero, XUV700, or the new XUV3XO, your on-road math just got simpler — and cheaper. This is the biggest broad-based SUV price reset of the year, and it lands right before the festive buying season. That’s why you’ll hear a lot about the Mahindra SUV price cut in the coming weeks.

What changed with GST 2.0 and how it hits prices

Mahindra said it will fully pass through the GST 2.0 rate cuts to buyers on its internal-combustion (ICE) SUV range, with revised prices in force from September 6, 2025. The company’s announcement lines up with the new tax structure that lowered the effective rate for certain compact SUVs from 31% to 18%, and trimmed the levy on larger SUVs from 48% to 40%. This realignment is what’s driving the drop you’re seeing on ex-showroom stickers.

The heaviest cuts sit where the tax moved the most. The XUV3XO Diesel gets the largest reduction — Rs 1.56 lakh — as it shifts into the lower tax band. The XUV3XO Petrol follows with a Rs 1.40 lakh cut. The Thar 2WD Diesel now costs Rs 1.35 lakh less. Mahindra’s body-on-frame staples have also moved: the Scorpio-N sees up to Rs 1.45 lakh off, and the Thar Roxx is cheaper by Rs 1.33 lakh. The flagship XUV700 trims up to Rs 1.43 lakh, while workhorse nameplates Bolero and Bolero Neo drop by as much as Rs 1.27 lakh. Even the Thar 4WD Diesel and Scorpio Classic get a flat Rs 1.01 lakh shave.

• XUV3XO Diesel: up to Rs 1.56 lakh lower (GST band down from 31% to 18%)
• XUV3XO Petrol: up to Rs 1.40 lakh lower
• Thar 2WD Diesel: up to Rs 1.35 lakh lower
• Scorpio-N: up to Rs 1.45 lakh lower (larger SUV slab eased from 48% to 40%)
• Thar Roxx: up to Rs 1.33 lakh lower
• XUV700: up to Rs 1.43 lakh lower
• Bolero, Bolero Neo: up to Rs 1.27 lakh lower
• Thar 4WD Diesel, Scorpio Classic: Rs 1.01 lakh lower

Remember, these are ex-showroom reductions. Your on-road price will fall further because state road tax and registration charges are calculated on ex-showroom value in most states. Insurance premiums will also nudge down a bit since IDV (insured declared value) is linked to price. The bottom line: the total money you save is typically higher than the ex-showroom cut alone, though the exact amount depends on your state and insurer.

Mahindra’s leadership has pitched this as action-over-words, with the company confirming that dealers nationwide have received updated price lists. If you booked earlier and are awaiting delivery, ask your dealer for an updated proforma invoice reflecting the new price — most OEMs pass on the benefit at the time of invoicing if the price change is effective before your car is billed.

What it means for buyers, rivals, and the SUV market

This move resets the value equation in segments where Mahindra is already strong. The XUV3XO now looks punchier against other compact SUVs, especially the diesel trims that benefit from the steepest tax drop. The Thar range sees a notable reduction on 2WD Diesel variants, widening the gap to 4WD models for buyers who want the look and stance without the off-road hardware. On the other end, the Scorpio-N and XUV700 — both high-demand models — get meaningful cuts that could pull fence-sitters into showrooms.

There’s a competitive dynamic too. The GST 2.0 changes have prompted other major carmakers to revisit prices. Tata Motors has confirmed it will pass on the tax benefit to customers from September 22. Expect sharper offers and limited-period schemes as rivals defend their turf in the lead-up to the festive quarter, especially in the Rs 10–25 lakh band where demand is most elastic.

For households financing their SUV, the math gets friendlier. A Rs 1.5 lakh reduction on a 5-year loan at around 10% interest can trim your EMI by roughly Rs 3,100–3,300 per month, depending on your lender and exact terms. Since road tax and insurance also dip off a lower base, the total cost of ownership across the first year moves down more than the headline ex-showroom cut might suggest.

If you’re shopping now, a few practical pointers help you lock in value:

• Get the new breakup: Ask for a fresh ex-showroom and on-road quote, including updated road tax and insurance. Compare it with your earlier proforma.
• Price protection on old bookings: If your car isn’t invoiced yet, request written confirmation that the revised price applies to your delivery.
• Variant strategy: Diesel compact SUVs like the XUV3XO Diesel have the steepest rate drop. That may shift the sweet spot of the lineup. Cross-check feature-to-price gaps again.
• Waiting periods: Price cuts pull crowds. If you’re on a deadline, be flexible on color or trim to improve delivery timelines.
• Finance re-approval: If your loan was sanctioned on the old price, ask the lender to re-issue the sanction letter with the new on-road cost. It can lower both your EMI and down payment.

Rural and fleet buyers should feel this change clearly. Bolero and Bolero Neo price cuts — up to Rs 1.27 lakh — lower acquisition costs for commercial users, contractors, and government tenders. Over large orders, the savings compound. For personal buyers in semi-urban markets, the new pricing can bring higher trims within reach, especially when paired with exchange bonuses or accessory packs dealers typically offer around festivals.

On the larger ladder-frame SUVs, the shift from the 48% to 40% slab is meaningful, but it won’t erase the price gap versus compact crossovers. What it does is improve affordability enough to keep demand buoyant without forcing heavy dealer discounts. For Mahindra, that helps keep waiting lists manageable and margins stable, even as more buyers move up the price ladder.

What about EVs and non-ICE models? Mahindra’s announcement applies to its ICE SUV portfolio. There’s no change stated for electric or alternative-fuel models. If you’re comparing across powertrains, factor that into your decision — the relative gap between an ICE SUV and an EV sibling could widen or narrow depending on how each brand responds to GST 2.0 in the coming weeks.

Will used car prices shift? Near-new examples — especially of the XUV700, Scorpio-N, and Thar — typically track new car prices. As ex-showroom prices fall, asking prices for recent used units often soften, particularly for trims that received the biggest cuts. If you’re selling, be prepared for more negotiation. If you’re buying used, verify the trim’s new ex-showroom value first; it’s a solid anchor in negotiations.

At dealerships, expect a quick reset. Sales teams will push refreshed EMI grids and showcase-trim variants that benefited the most. Accessories and extended warranty bundles may get tweaked to maintain invoice value. If you want pure price benefit without add-ons, be clear about that during negotiation — dealers often have flexibility on insurance and accessories.

A timing note: Mahindra’s revised prices kicked in on September 6. Tata’s pass-through starts September 22. If you’re cross-shopping between brands, align your booking and invoicing dates with these effective windows to avoid missing an applicable price reduction.

Finally, don’t overlook the paperwork. Ask for the updated ex-showroom price on the booking form, revised delivery timeframe, and any changes to cancellation terms. For corporate or government purchases, ensure your purchase order reflects the new price to avoid re-approval delays.

The net effect is simple: the government’s GST 2.0 reset has trimmed the tax burden on a wide swathe of SUVs, and Mahindra has moved first with across-the-board cuts on its ICE portfolio. For buyers, this is one of those rare weeks when waiting a little paid off — and if you were undecided about timing your SUV purchase, the numbers now do a lot of the talking.