- Tesla is reportedly planning to invest around $2 billion initially in a new plant in India.
- They also plan to buy auto parts from India worth up to $15 billion.
- Reportedly, the automobile company is considering making some batteries in India to reduce costs.
- Tesla’s India plans may be announced at the Vibrant Gujarat Global Summit in January 2024.
According to sources familiar with the Indian government, a new agreement with the American automaker, Tesla Inc. could see Tesla Electric Vehicles sold in India by 2024, with the carmaker churning out Indian-made cars from its new plant within the next two years. The official announcement is expected to be made at the Vibrant Gujarat Global Summit in January 2024. At the moment, Gujarat, Maharashtra and Tamil Nadu are being considered for the factory as these three states have relatively well-developed ecosystems for making EVs and aiding in their export.
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What The Agreement Entails
As part of the potential agreement, Tesla is expected to commit an initial minimum investment of approximately $2 billion (about Rs 16,665 crore) for the plant. Tesla had earlier planned to source $1.9 billion (approximately Rs 15,700 crore) worth of auto components during this year, almost doubling the amount it sourced last year, and is looking at increasing the purchase of Indian auto parts to $15 billion (about Rs 1.2 lakh crore).
While no final decision has been made yet, Tesla CEO Elon Musk said in June that the company plans to make a “significant investment” in India; he also intends to visit the country in 2024. A report by Reuters also showed that the brand is looking to make and sell battery storage systems in India, and it had even submitted a proposal to Indian officials seeking incentives to build the Powerwall battery storage factory.
The Indian government is now said to be considering lowering import taxes for international EV carmakers for a period of five years, but only if those firms commit to setting up local manufacturing plants. This policy could see our market opening up to Tesla cars as the company lays the groundwork to get its India operations moving.
Piyush Goyal At The US Tesla Factory
Last week, Union Minister Piyush Goyal visited the Tesla factory in Fremont, where the elected representative was scheduled to meet Elon Musk. However, the meeting couldn’t happen due to Musk’s health but the billionaire promised to meet the minister soon. Goyal met the top leadership from India including researchers and engineers from India at the Tesla factory.
Electric cars made up only 1.3% of all passenger vehicles sold last year. This is because electric cars are expensive and there aren’t many charging stations. Tesla doesn’t currently import cars directly into India because of high tariffs. According to sources, when Tesla’s first made-in-India models go on sale, they could be sold for as little as USD 20,000 (about Rs 16.67 lakh).
