- India has been taxing motorcycles over 350 cc at 40 percent GST instead of the previous 31 percent since September 2025
- Triumph has converted its entire 400 series to 349 cc for India, KTM follows with the Duke 390 and Adventure 390
- A new Triumph Bonneville 400 with a unique chassis and retro design is currently being tested
When the world’s largest motorcycle market changes its tax rules, the consequences are far-reaching. India, where around 20 million motorcycles are sold annually, fundamentally restructured its so-called GST (Goods and Services Tax) for two-wheelers in September 2025. Motorcycles with an engine displacement of up to 350 cc have since been taxed at 18 percent instead of the previous 28 percent. For anything above that threshold, the tax rate has risen from roughly 31 percent to 40 percent. The result is a massive price gap right at the 350 cc boundary, forcing manufacturers like Triumph and KTM to take action.
Why have Triumph and KTM downsized their engines?
The reason lies entirely in the tax structure. Both manufacturers have their 400-class motorcycles produced by Bajaj Auto at the Indian plant in Chakan. Bajaj is both a production partner for Triumph and the majority shareholder of KTM. Manik Nangia, President of the Probiking division at Bajaj Auto, spoke of strong momentum at the Triumph launch that they wanted to leverage through the more favorable tax bracket for additional buyers. Rajiv Bajaj, Managing Director of Bajaj Auto, had officially confirmed the market launch of the downsized models back in February 2026.
Triumph was first to market, converting the entire 400 series for India to the new 349 cc engine on April 6, 2026. KTM followed roughly two weeks later with the Duke 390 and Adventure 390 in the downsized variant.
How does the downsizing work technically?
Both manufacturers use different approaches to get below the 350 cc threshold. Triumph employs a new crankshaft that reduces the stroke from 64 mm to 56.1 mm. The bore remains at 89 mm. This means pistons, valves, and combustion chamber geometry do not need to be changed, which limits the conversion effort.
KTM takes a similar route with its 399 cc single-cylinder engine, reducing displacement to exactly 349.32 cc. The technical details of KTM’s displacement reduction have been communicated less thoroughly, but the result is comparable: an engine that sits just below the tax-relevant threshold while remaining technically closely related to the larger unit.
How much power is lost through the downsizing?
The power losses remain within a range that should be barely noticeable in everyday riding. For Triumph, the situation varies by model:
The Speed 400, Scrambler 400 X, and Scrambler 400 XC produce 27.21 kW (37 hp) at 8,500 rpm in the 349 cc version instead of 29.4 kW (40 hp) at 8,000 rpm. Torque drops from 37.5 Nm at 6,500 rpm to 32 Nm at 7,000 rpm. The Tracker 400 and Thruxton 400, which achieve 30.89 kW (42 hp) at 9,000 rpm and 37.5 Nm at 7,500 rpm in the 398 cc version, deliver 29.42 kW (40 hp) at 8,750 rpm and 32 Nm at 7,500 rpm with the smaller engine. The Speed T4, an entry-level model available only in India with simpler equipment, drops from 23 kW (31 hp) to 21.33 kW (29 hp) at 7,500 rpm and from 36 Nm to 31 Nm at 5,500 rpm.
KTM’s new 349 cc engine produces 41.5 hp at 8,600 rpm and 33.5 Nm at 7,000 rpm. Compared to the 399 cc unit, that represents a loss of 4.5 hp and 5.5 Nm. Ride reports from India describe the difference as noticeable during sprints (the 0-to-100 km/h time reportedly increased from about 7.4 to roughly 8.8 seconds for the Scrambler 400 X), but barely relevant in normal traffic and when cruising between 80 and 100 km/h.
What do the new 349 cc models cost in India?
The price reductions resulting from the lower tax bracket vary by model. For Triumph, the price range starts with the Speed T4 at 1.95 lakh rupees (approximately 2,100 euros / 2,340 USD). The Speed 400 costs 2.31 lakh rupees (approximately 2,490 euros / 2,770 USD), a decrease of around 7,100 rupees compared to the 398 cc version. The Scrambler 400 X is priced at 2.59 lakh rupees (approximately 2,790 euros / 3,100 USD), and the Thruxton 400 at 2.66 lakh rupees (approximately 2,860 euros / 3,190 USD) with the largest price reduction of around 10,800 rupees.
KTM’s new Duke 390 with the 349 cc engine starts at 2.77 lakh rupees (approximately 2,980 euros / 3,320 USD), the Adventure 390 at 2.81 lakh rupees (approximately 3,020 euros / 3,370 USD). The price difference to the still-available 399 cc version is considerably larger here. The previous Duke 390 continues to be sold in India as the Duke 390 R at 3.39 lakh rupees (approximately 3,650 euros / 4,070 USD). The price gap between the 349 cc Duke and the Duke 390 R amounts to roughly 75,000 rupees (approximately 810 euros / 900 USD).
What equipment do the downsized models retain?
In both cases, the equipment remains virtually identical to the larger engine variant. KTM’s models retain their 5-inch TFT display with smartphone connectivity, ride modes (Street, Rain, and Track for the Duke; Street, Rain, and Off-road for the Adventure), cornering ABS, traction control, and the bidirectional quickshifter. Chassis and frame remain unchanged.
Triumph has one exception that flew under the radar: the new 349 cc models for India are delivered without an immobilizer. The indicator light in the cockpit is still present, but the function itself is deactivated. Whether this remains a permanent cost-cutting measure or will be corrected retroactively remains to be seen.
Which competitors already sit below the 350 cc threshold?
Not all manufacturers need to adapt their engines. Royal Enfield’s entire 350 series with the Classic 350, Hunter 350, Bullet 350, and Meteor 350 already sits below the threshold with the air-cooled J-Series engine and benefits directly from the tax reduction. According to industry reports, Royal Enfield was able to lower prices on these models by around 22,000 rupees (approximately 235 euros / 260 USD). Around 87 percent of Royal Enfield’s sales come from 350 cc models, making the brand one of the biggest beneficiaries of the reform.
Also already below the threshold are the BSA Bantam 350, Honda CB350, and Yamaha’s MT-03 and R3. Classic Legends with the Jawa and Yezdi brands also benefits, as its entire portfolio sits below 350 cc.
What does this mean for buyers outside India?
In the short term, nothing changes for customers in Europe, North America, or Australia. Triumph and KTM will continue to sell the larger engine variants with 398 and 399 cc respectively in international markets. The 349 cc versions are exclusively intended for the Indian market for now.
In the long term, however, the picture could look different. India has become the global production center for small and mid-displacement motorcycles. Models like the Triumph Speed 400 or the KTM Duke 390 were never designed exclusively for the Indian market, but they depend significantly on production volumes there. Only because demand in India was so high could these motorcycles be offered at internationally competitive prices.
If Indian demand now shifts significantly toward 350 cc, production numbers in the 400 cc segment will decline. Lower volumes mean higher costs per unit, which could eventually be reflected in the price lists of export markets. For future model changes or entirely new platforms, it is conceivable that manufacturers might switch globally to 350 cc for reasons of economies of scale and parts commonality.
What about the upcoming Triumph Bonneville 400?
Parallel to the downsizing of existing models, Triumph is already working on the next member of the 400 family. A development prototype was photographed during test rides in Europe in April 2026, showing a retro naked bike that stylistically draws on the larger Bonneville models T100 and T120.
Unlike the other 400 models, which all share the same frame, the Bonneville 400 will reportedly receive a unique chassis. The rear end has been switched to a classic twin shock absorber setup instead of the monoshock system used on the Speed and Scrambler. This changes not only the appearance but also the riding character toward a more relaxed roadster.
Further identifiable details of the prototype include a teardrop-shaped tank, a flat bench seat, spoke wheels with Pirelli Phantom Sportscomp tires, a low-mounted single exhaust in the style of the larger Bonneville T120, conventional telescopic forks with gaiters, a center stand, and a pillion setup with grab rail. A new single round instrument was also spotted that has not been used on any other model in the 400 series.
The engine is expected to be fitted in the 398 cc variant for export markets and in the 349 cc version for India. For the Indian market, a tune is expected that aligns more with the character of the Speed T4, emphasizing low-end torque rather than peak power. The market launch is expected for the fourth quarter of 2026, potentially around the Indian festival season before Diwali. An unveiling at EICMA 2026 is also considered likely.
The Bonneville name makes sense given its brand recognition, although Triumph could also revive a historical name from its own single-cylinder heritage. Designations such as Cub, Trophy, or Terrier have been mentioned in this context.
How does the tax reform fit into the Indian market?
The GST restructuring was decided at the 56th GST Council Meeting and took effect on September 22, 2025. The core of the reform is a simplification of the previous tax structure toward fewer tax rates. For the motorcycle market, this specifically means: motorcycles up to 350 cc pay 18 percent GST, everything above 40 percent. Previously, the rate for all motorcycles was 28 percent GST plus 3 percent cess (surcharge), effectively 31 percent for larger machines.
The gap of 22 percentage points between the two tax rates (18 versus 40 percent) is so large that in a price-sensitive market like India, it fundamentally changes the purchasing decision process. Around 98 percent of the Indian motorcycle market already sits below 350 cc and benefits from the tax reduction. The reform primarily affects the premium mid-range between 350 and 500 cc, where manufacturers like Triumph, KTM, and Royal Enfield with newer models like the Himalayan 450 and Guerrilla 450 are impacted.
Triumph had initially absorbed the price increase from the higher tax and even implemented price reductions of around 16,000 rupees on selected 400 models in October 2025 to remain competitive during the festival season. According to industry reports, Triumph sells around 3,500 units of the 400 series monthly in India and had brought a total of 100,000 Triumph motorcycles to Indian roads by April 2026. The strategy of permanently absorbing the tax disadvantage, however, proved unsustainable.
Frequently Asked Questions
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What is the difference between the Triumph Speed 400 with 398 and 349 cc?
The 349 cc version uses a shorter crankshaft with a 56.1 mm stroke instead of 64 mm while maintaining the same 89 mm bore. Power drops by about 3 hp to 37 hp at 8,500 rpm, torque by 5.5 Nm to 32 Nm. Externally, the two variants are indistinguishable, as Triumph retains the “400” model designation.
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Will the KTM Duke 390 with 349 cc also be sold in Europe?
No, the 349 cc variant is currently intended exclusively for the Indian market. In Europe and other export markets, the Duke 390 remains available with the 399 cc engine. In India, both variants exist side by side, with the larger version marketed there as the Duke 390 R.
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When will the Triumph Bonneville 400 launch?
According to industry reports, the market launch of the Triumph Bonneville 400 is expected for the fourth quarter of 2026, likely around the Indian festival season. An official unveiling at EICMA 2026 is considered probable. The price in India is expected to be around 2.00 to 2.25 lakh rupees (approximately 2,150 to 2,420 euros / 2,400 to 2,700 USD).
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Why is the tax threshold in India set at exactly 350 cc?
The 350 cc threshold was already the dividing line between tax rates before the GST reform. With the restructuring in September 2025, this threshold was maintained, but the tax rates above and below it were spread significantly further apart. Motorcycles up to 350 cc now pay 18 percent GST, motorcycles above 40 percent.
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Could the 349 cc variant eventually replace the 400 cc engine worldwide?
Not in the short term, but a global switch to 350 cc is conceivable with future model changes. Production volumes in India are so large that they influence per-unit costs for the global market. If demand in India permanently shifts toward 350 cc, economies of scale and parts commonality could lead to export models also being switched to the smaller engine in the next generation.
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