Elon Musk says that Tesla’s EV entry into India will be a “natural progression.”According to Tesla CEO Elon Musk, providing Tesla electric vehicles in India will be a logical next step for his company since India, like every other nation, should have electric cars.
In terms of population, India is currently the most populated nation on Earth. Just like every other nation, India ought to have electric vehicles. Offering Tesla electric cars in India is a logical next step, Elon Musk stated during an X Spaces meeting with Nicolai Tangen, the CEO of Norges Bank Investment Management.
“All vehicles will go electric, and it is just a matter of time,” declared the billionaire CEO.
Recently, Tesla has stepped up its efforts to increase its market share in India and is actively looking for a suitable site to build a state-of-the-art manufacturing facility.
The state governments of Gujarat and Maharashtra, according to sources, have made Tesla Inc. attractive land offers for the construction of an EV manufacturing facility. This represents a significant advancement in India’s electric mobility landscape.
According to sources, the proposed plant would cost between $2 billion and $3 billion to build and would serve the domestic and foreign markets for Tesla’s electric cars.
The action follows India’s recent EV policy, which offers incentives for establishing a manufacturing facility there. As a major EV producer worldwide, Tesla intends to build a strong manufacturing base in India.
Several important goals are listed under the government’s EV scheme, which aims to position India as a preferred manufacturing destination for EVs outfitted with cutting-edge technology.
These include encouraging the uptake of cutting-edge EV technology by Indian consumers, drawing investments from respectable international EV manufacturers, and supporting the nation’s Made in India campaign.
In addition to encouraging manufacturers to achieve significant levels of domestic value addition (DVA), the policy asks for a minimum investment threshold of Rs 4150 crore (USD 500 million). By the third year of the manufacturing unit’s establishment, the government mandates that at least 25% of the parts used to make the vehicles must be sourced domestically. It is anticipated that by the fifth year of operation, this localization level will rise to 50%.
If the manufacturer constructs manufacturing facilities in India within three years, a 15 percent customs duty will be levied for five years on vehicles valued at USD 35,000.
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The policy will set a cap on the total number of EVs that can be imported, taking into account the amount invested. or, at most, Rs 6484 crore in value, whichever is less. According to the policy, a maximum of 40,000 EVs can be imported, with no more than 8,000 per year, if the investment exceeds USD 800 million. Import restrictions may be carried over.
Tesla plans to send a team of experts to search India for potential sites for the proposed manufacturing facility as part of its investment plans.
By the end of this month, the government will formally invite applications for the EV tariff reduction scheme, which will permit eligible companies to import up to 8,000 vehicles annually, according to a Financial Times report that cited an Indian official.
Elon Musk, the CEO of Tesla, stated in June of last year that he intended to travel to India in 2024 and expressed confidence that the electric vehicle manufacturer would arrive in the country “as soon as humanly possible.”
After meeting with Prime Minister Narendra Modi, who was then on a historic four-day state visit to the US, he told reporters in New York.
PM Modi extended an invitation to Musk to visit India.
Musk had stated, “Hopefully, we will be able to announce something in the future. I would like to thank PM Modi for his support.”
Union Minister for Commerce and Industry Piyush Goyal stated that Tesla is planning to double its imports of parts from India during a visit to the US electric car manufacturer’s Fremont, California, manufacturing facility in November 2023.
Mr. Goyal had emphasized how pleased he was with the growing role that Indian auto component suppliers were playing in the Tesla EV supply chain.
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