South Africans paying double for the cheapest Indian cars

Motorists are paying up to twice as much for Indian cars in South Africa than they are in their home market.

Indian-made cars are quickly becoming one of the dominant players in the South African market owing to their affordability, but these prices are still much higher than what consumers are paying for them overseas.

When affordable means paying double

It should be noted at the start that it is hardly unusual for Indian cars to be cheaper in India than in other countries, since they are able to avoid the various costs involved with importing, from shipping fees to import duties.

There is a 25% import tax, as well as VAT and smaller costs like customs fees and tyre levies.

However, even if we take these factors into consideration, it is still surprising to see just how big of a gap there is between an Indian car’s “original” price and the sticker that South Africans are required to pay.

TopAuto looked at a selection of cars on sale in South Africa that are produced and imported from the sub-continent to compare how much more expensive they are by the time they reach our shores.

Of course, “Indian cars” does not just refer to original Indian brands such as Mahindra these days, as several major automakers in South Africa now import models from their overseas factories, including Citroen, Hyundai, Suzuki, and Toyota.

One other thing to note about India is that its prices are typically advertised in “Lahk” which is a unit of measurement equal to 100,000.

This is because the value of a single Indian rupee is only 21 of your finest South African cents, which means large sums, such as car prices, are advertised in Lahk to simplify the otherwise enormous figures.

These are the Indian and South African prices for five different cars produced in the South Asian nation:

All five of these cars are viewed as “budget” models by South African pricing standards, and yet they are all selling for at least R80,000 more than in their home market.

Percentage-wise, the Urban Cruiser is actually the least affected with a 45% markup, while the Exter is a staggering 105% more expensive here.

Interestingly, the Hyundai is actually slightly cheaper than the Suzuki Swift hatchback in India, which is definitely not the case in Mzansi.

It must be noted that the cars being compared here are not one-to-one equivalents, as the South African models typically feature more equipment than their counterparts on the sub-continent.

This understandably raises the cost of the South African models, but the Indian cars are also cheaper thanks to a government incentive programme for lower taxes on small cars, which is meant to make them more accessible for low-income households.

It reflects an unfortunate reality for local motorists, which is the simple fact that cars are incredibly expensive here no matter where they come from.

Again, it may be tempting to dismiss the comparison on the grounds that Indian cars are obviously cheaper in India, which is true, but the same cannot be said of South Africa’s locally-made cars.

India and China’s car prices suggest that it is far better to purchase locally than to import, but South Africa only produces a single wallet-friendly model in the form of the VW Polo Vivo.

Even then, this further illustrates how expensive South African cars are, as the Vivo retails for at least R271,900.

In other words, a relatively spartan hatchback made right here in the Eastern Cape costs roughly the same as several vehicles imported from India, even with their inflated price tags.

It therefore comes as no surprise that brands like Mahindra and Suzuki are rocketing to the top of the sales charts, as South Africans appear to be getting little to no financial benefit from buying cars produced in their own backyard.