Difference Between Ex Showroom Price and On Road Price

What is an Ex-Showroom Price?

The ex-showroom price of a car is basically the cost of the vehicle. It is the amount an automobile brand is willing to charge for designing, manufacturing, and making a car available in the market. This price does not contain the fees paid to register the vehicle with your nearest Regional Transport Office (RTO), insurance, and road tax. 

 

Here are a few points that can make the concept of ex-showroom price simpler for you:

 

• It includes GST, the ex-factory cost, and the dealer’s profit margin.

• The ex-showroom price is also the amount that’s generally advertised.

What is On-Road Price?

As the name suggests, an on-road price of a car is the amount you pay to transport the vehicle from a showroom to the road. It contains the road tax, ex-showroom price, insurance, registration fee, and other optional charges. So, let us assume that you are planning to buy a Maruti Alto 800.  If you choose to purchase accessories from the dealer, along with paying road tax, registration fee, and Alto 800 insurance price, you will have to pay extra charges towards that additional purchase.

Difference Between an Ex-Showroom Price and On-Road Price of a Vehicle

The below table highlights the key differences between the ex-showroom price and on-road price:

Factors Affecting a Car’s On-Road Price

Here are a few factors that have an impact on the on-road price of a vehicle:

 

• Annual Maintenance Package

Car dealers also offer an annual maintenance package which consists of multiple services. And they are:

1. Polishing

2. Servicing

3. Cleaning

4. Roadside Assistance

However, if your car insurance plan takes care of the annual maintenance cost, you don't need to buy the dealer's plan.

• Extended Warranty

Here’s a fact: you are allowed to extend the warranty for an extra cost. So, if you resell the car with a warranty, you get a better deal. Since it is over and above the ex-showroom price, the cost of extended warranty is considered to be a part of the on-road price.

• Essential Accessories

Essential accessories like seat covers, floor mats, a biker's jacket, or a helmet are offered by the dealer. If you choose to buy these essentials from the dealer, the on-road price will also include their prices.

• Green Cess

Green cess is different in each state and usually depends on the ex-showroom price.

• Insurance

The Motor Vehicles Act, 1988 makes motor insurance mandatory for every vehicle owner if they wish to drive their car on Indian roads. Usually, vehicle dealers have tie-ups with insurance companies. You can also choose to buy it on your own for a customised plan. This will, irrespectively fall under the component on-road price.

• Handling Charges

A dealer may also include the vehicle handling charges or the money required to transport your car from the factory to the showroom.

• Registration Charges

It is mandatory to register every car under the nearest RTO. Your car dealer will most probably undertake this job for you. Once registered, you will receive a licence plate, after which, you can start driving your vehicle.

• Tax Collected at Source

The dealer also collects 1% tax on the ex-showroom price as Tax Collected at Source.

• Road Tax

Road tax is levied when you register your new vehicle. The tax amount can be anywhere between 3-20% of your vehicle's ex-showroom price.

Factors Affecting a Car’s Ex-showroom Price

Let’s checkout the 3 factors that affect the ex-showroom price of a four-wheeler:

 

• GST

A car’s ex-showroom price includes a Goods and Services Tax that is levied by the government.

• Dealer's Margin

The ex-showroom price of a car also includes the car dealer’s profit margin that he wishes to earn by selling the vehicle.

• Ex-Factory Price

This is the manufacturing price of the car. It is the amount that the car dealer pays to the manufacturing company to get the car.

Conclusion

That’s everything you need to know about the ex-showroom price and on-road price of a vehicle. The ex-showroom price, as well as the on-road price, can vary from one city to another. For instance, the cost of buying a car could be more in Bangalore than it is in Mumbai.

 

If you plan to do your research and buy an insurance plan for yourself, browse through the insurance plans available on Bajaj Markets. We are a host to the best plans offered by the leading insurance providers in India. We enable you to compare, customise, and buy the best-suited motor insurance plan.