Introduction: Tata Motors Share Price
Tata Motors share price faced heavy selling in the auto and auto sector related stocks after a statement made by Union Transport Minister Nitin Gadkari. The minister stated that he will discuss with the Finance Minister the removal of diesel vehicles from the roads. This news caused a significant impact on the market and led to a drop in auto shares.
10 percent additional GST on diesel vehicles
Union Road Transport and Highways Minister Nitin Gadkari revealed that he plans to discuss with Finance Minister Nirmala Sitharaman the imposition of a 10 percent additional GST on diesel vehicles. He believes that this tax should be implemented as a pollution tax. Gadkari also mentioned that the target of achieving a 20 percent ethanol blend will be reached soon.
A call to increase production of e-vehicles
Gadkari emphasized the need to increase the production of e-vehicles and reduce reliance on diesel engines. Currently, diesel commercial vehicles account for 80 percent of Mahindra & Mahindra’s total exposure in the business year 2023. However, Tata Motors’ exposure to diesel vehicles is only around 15 percent. Gadkari expressed concern over the increasing imports of fossil fuels and urged industries to bring BS6 stage 2 soon. He suggested that diesel vehicles should be removed or taxed heavily. He also highlighted the significant increase in the registration of electric vehicles, reaching 3 million, an increase of 300 percent.
Which stocks fell by how much percentage?
Following Nitin Gadkari’s statement, the Nifty Auto Index experienced a drop of almost 2 percent. Stocks such as Bharat Forge, Motherson Sumi, Ashok Leyland, Tata Motors, Eicher Motors, Mahindra & Mahindra, MRF, TVS Motors, Hero MotoCorp, and Maruti Suzuki all witnessed a decline in their share prices.
Gadkari’s explanation
After the initial statement caused confusion, Nitin Gadkari clarified his position on social media. He emphasized the importance of promoting clean and green alternative fuels to reduce emissions and pollution. He stated that these fuels should be used as a cost-effective and indigenous alternative to imported fuels.
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