Source : PTI | It is no secret that American EV making giant Tesla Inc. is planning to enter the ever-growing Indian automotive sector, with CEO Elon Musk having mentioned the plans multiple times over the past few months. It seems like we are now inching closer to Tesla’s India entry, which could happen as soon as next year.
About a month ago, TOI had revealed that the Indian government is considering introducing a new electric vehicle policy that would slash import taxes for car companies that commit to some local manufacturing. The tax reduction could mean that Tesla (and other global EV companies) can test-market their products before fully committing to the market and setting up a plant for manufacturing locally.
However, the tax will only be lowered given that carmakers agree to eventually start work on manufacturing their products in India, promise to start sourcing components locally and provide bank guarantees towards any faults in their commitments.
That said, Tesla will likely first introduce fully imported (CBU) cars in India to gauge customer response and also gather data about how their EVs perform in Indian climatic and road conditions. This input would be helpful for the company’s ultimate goal – setting up a manufacturing plant in India to sell locally made and accessible electric vehicles.
As for where Tesla could set up a manufacturing plant in India, Tamil Nadu, Maharashtra, Haryana, and Gujarat are the four states that are key hubs for automobile manufacturing in the country, and hence are strong contenders. States such as UP and Karnataka too are pushing strongly for investments so they too can be considered to be in the race. Carmakers generally prefer to set plants near sea ports, which means that Tamil Nadu, Maharashtra and Gujarat might have an upper hand to be Tesla’s choice.
However, considering the number of auto component makers supplying for EVs present in Gujarat and Tamil Nadu, these two states hold an edge over others and one of the could end up being the home to Tesla’s Indian factory.
There’s no official word from any of the stakeholders about the location or investment for the pant but it will certainly be interesting to witness the developments over the next few months and years.
