Recent reports strongly suggest that Tesla is on the verge of making its foray into the Indian market, with the government actively streamlining the import process for the American automaker’s electric vehicles. Unofficial sources reveal Tesla’s plan to establish a production unit in India within 24 months of its official entry. While no official announcement has been issued, speculation points to the Vibrant Gujarat Summit next year as a potential stage for unveiling this development. States such as Kerala, Tamil Nadu, Maharashtra, and Gujarat are anticipated to compete for the opportunity to host Tesla’s production facility.
It is anticipated that Tesla will commit a minimum of USD 2 billion to set up the production unit, with a strong emphasis on achieving extensive localization for electric cars. Reports also indicate that Tesla might source components locally, amounting to an estimated USD 15 billion. Previous indications hinted at Tesla producing battery packs domestically to manage the costs of its electric vehicles (EVs).
Despite the decreasing cost of electric vehicles, particularly in larger and more luxurious segments, Tesla seems poised to establish new benchmarks for localization. According to some reports, the inaugural Tesla model manufactured in India could potentially be priced at Rs 17 lakh. To offer context, the top-spec trims of the Mahindra Scorpio-N – Z8L, presently priced at Rs 20.02 lakh ex-showroom, serve as a relevant reference point.
The viability of Tesla’s entry into the Indian market is further underlined by improved relations between the Indian government and the electric vehicle giant. A notable development in this regard was the visit of the Union Minister for Commerce to Tesla’s factory in the USA. Despite Elon Musk’s illness preventing a meeting with Piyush Goel, the minister expressed satisfaction with the state-of-the-art manufacturing unit. Musk later issued an apology on the social media platform X for the missed meeting, underscoring a commitment to fostering positive relations.
