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Tesla to send team from US to pick up potential manufacturing sites in India: Report
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Tesla to send team from US to pick up potential manufacturing sites in India: Report

| @indiablooms | 04 Apr 2024, 12:19 am

New Delhi: Electronic car-maker Tesla plans to send a team from the United States to India by late April to assess potential locations for a proposed electric car plant worth $2 billion to $3 billion, the Financial Times reported on Wednesday.

Billionaire Elon Musk-led company's move into the Indian market coincides with a slowdown in electric vehicle demand in its primary markets, the U.S. and China, amid intensifying competition from other players.

The drop in demand led to a decrease in Tesla's first-quarter deliveries and missing estimated figures.

The electric vehicle manufacturer will prioritize Indian states known for their automotive hubs, such as Maharashtra, Gujarat, and Tamil Nadu, according to the report.

Last month, India reduced import taxes on specific electric vehicles produced by manufacturers willing to invest at least $500 million and commence domestic manufacturing within three years. This decision was viewed as strengthening Tesla's prospects in the market.

Tesla has been striving to establish a presence in India for several years, but negotiations with New Delhi required a commitment to local manufacturing.

India's electric vehicle (EV) market is small but steadily growing. Indian auto major Tata Motors dominates the market at present.

In 2023, EVs accounted for approximately 2% of total car sales in India, with the government aiming for this figure to reach 30% by 2030.

Analysts suggest that Tesla's entry into the Indian market could stimulate further investments in EVs and provide advantages to local auto parts manufacturers, Reuters reported.

Image Credit: PIBImage Credit: PIB

Over the past year, Tesla officials have engaged in discussions with government representatives, including a meeting between CEO Elon Musk and Prime Minister Narendra Modi in June.

In July of last year, the company expressed its interest in establishing a factory in India to manufacture an EV priced at $24,000. the company, however, demanded reduced taxes on higher-priced models it intends to sell in India, Reuters reported.

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