Ex-showroom vs on-road price: what you actually pay for a car

What the ex-showroom price includes

The ex-showroom price is what the maker and dealer charge for the car itself, ready to leave the showroom. GST is already inside it: 18% on small petrol and diesel cars (under four metres, with a petrol engine up to 1.2 litres or a diesel up to 1.5 litres), 40% on bigger cars, and 5% on electric cars. Transport to the dealer and the pre-delivery check are usually included too.

This is the figure makers advertise and the one you see on every car page, because it is the same for everyone in a city. It is not what you pay.

What the on-road price adds

To drive the car on a public road it has to be registered, taxed and insured. Those costs, added to the ex-showroom price, make the on-road price:

• Road tax: a one-time tax your state charges when the car is registered, usually a percentage of the ex-showroom price. It is the biggest addition and the main reason the same car costs more in one state than another.
• Registration and number plate: the RTO's registration fee (₹600 for a private car) and the high-security number plate (HSRP).
• FASTag: the toll tag, a few hundred rupees.
• Insurance: by law a new car needs three years of third-party cover at the start, plus the one-year own-damage policy that pays for repairs to your own car.
• Some states add a cess or other charges on top of road tax.

The same ₹10 lakh car in different states

Here is a petrol car with a 1.2-litre engine and an ex-showroom price of ₹10 lakh, worked out with the same calculator our car pages use. Only road tax and cess change from state to state; the rest is the same everywhere.

Why electric cars come out lower

Most states, including Delhi, Maharashtra, Karnataka, Tamil Nadu, Uttar Pradesh and Madhya Pradesh, charge no road tax on electric cars, and third-party insurance costs less for them. An electric car with the same ₹10 lakh ex-showroom price comes to about ₹10.45 lakh on the road in all six, a gap of ₹75,000 to ₹1.6 lakh against the petrol car.

These waivers are state policy and some have an end date, so check your state's current rule before you count on it.

Other things that can appear on a dealer's quote

A dealer's on-road quote often has more lines than the ones above. Some are optional, and one you get back:

• TCS: on a car above ₹10 lakh, the dealer collects 1% tax at source. It is not a cost: it is credited against your income tax and you can claim it back when you file your return.
• Accessories: mats, seat covers and 'kits' are optional. Ask for the price without them.
• Extended warranty and service packages: useful on some cars, but optional and priced separately.
• 'Handling' or 'logistics' charges: ask what they cover. Transport to the dealer is normally already in the ex-showroom price.
• Insurance: the dealer's policy is convenient, not compulsory. You can buy the own-damage cover from any insurer and compare the premium.

How to use this when you buy

Ask every dealer for an itemised on-road quote for the exact variant, colour and city of registration. Road tax and registration should match to the rupee between dealers; if they do not, ask why. Then compare the insurance premium with one you get yourself, and strike out the add-ons you do not want.

On our car pages, the on-road section works out the price for your state from the ex-showroom price, so you can see roughly what to expect before you talk to a dealer.