India–European Union Trade Deal: These European Cars Could Get Much Cheaper In India

Updated: Tuesday, January 27, 2026, 15:25 [IST]

The ongoing trade deal between India and the European Union is nearing the final agreement. After the deal, European cars priced above €15,000 could become significantly more affordable in India, as import duties are expected to fall from the current 110% to as low as 10%. So, which cars are likely to become cheaper and more affordable if the India-EU trade deal goes through? Let's take a closer look.

India-European Union Trade Deal Benefits

Brands With No Assembly in India

Ultra-luxury and supercar brands such as Lamborghini, Ferrari, Bentley, Maserati, and Rolls-Royce do not have assembly or manufacturing plants in India. All their models are imported as CBUs, attracting heavy import duties.

These brands stand to benefit the most from the India-EU free trade agreement. For example, the Lamborghini Urus SE, currently priced at around ₹4.57 crore, could drop to nearly ₹3.20 crore, with savings of approximately ₹1.37 crore. Such a reduction could significantly expand the buyer base for ultra-luxury vehicles in India.

Brands With Partial Assembly in India

Manufacturers such as Audi, BMW, Mercedes-Benz, and Porsche operate CKD assembly plants in India. However, many high-performance and enthusiast-focused models are still imported directly from Europe, after paying full import duty.

Cars like the BMW M4 Competition, Mercedes-AMG models, Audi RS range, and the Porsche 911 series are all imported as CBUs. With reduced tariffs under the trade deal, prices of these performance-oriented cars could see significant cuts, making them far more accessible to Indian car enthusiasts.

Specially Imported Cars Despite Local Manufacturing

Brands such as Skoda, Volkswagen, and Land Rover already manufacture vehicles in India. However, they still import select premium or superior models from Europe. Imported cars such as the Skoda Octavia RS (₹60 lakh) could drop to nearly ₹42 lakh. The Volkswagen Golf GTI (₹53 lakh) could be around ₹39 lakh. The Land Rover Defender (₹98 lakh) could be sold for ₹72 lakh.

Example Price chart

Cars	Price Before Ind-EU FTA (110%)	Price After Ind-EU FTA (40%) Approximate Pricing
Lamborghini Urus SE	₹4.57 crore	₹3.20 crore
Land Rover Defender	₹98 lakh	₹72 lakh
Skoda Octaiva RS	₹50-60 lakh	₹35- 40 lakh
Volkswagen Golf GTI	₹53 - 60 lakh	₹35-43 lakh

These price cuts would make these models extremely competitive. They could even become a serious challengers to locally assembled luxury offerings from BMW, Mercedes-Benz, and Audi, as they offer similar performance and capability.

Why This Trade Deal Matters to the Indian Auto Industry

Lower import duties could reshape India's premium and luxury car market. European cars would become more approachable. Buyers would gain access to a wider range of global models at more realistic prices. At the same time, this increased competition would force local manufacturers to improve value, features, and pricing to remain competitive.

Local Brands Under Threat

Due to this new FTA agreement, flagship cars from brands such as Maruti Suzuki, Hyundai, Mahindra, Toyota and Tata Motors are under threat. With European cars becoming more affordable and value-focused, some domestic premium offerings may struggle to justify their pricing.

Exclusions

These reduced prices may not be permanent, as reports suggest the agreement will be on an annual basis and be limited to an initial quota of around 2.5 lakh units per year. The Indian government is also taking a cautious approach to protect local manufacturers such as Maruti Suzuki, Hyundai, Tata, and Mahindra by excluding electric vehicles from these new tariff reliefs for the first five years.