Tesla’s Indian debut is inching closer thanks to the government’s new electric vehicle policy. Here’s a breakdown of what to expect:
Production Shift and Potential India Hub:
- Gearing Up in Germany: Reuters reports Tesla has begun manufacturing right-hand drive cars at its German factory. This could be a sign for India, as the Model Y is currently the only car produced there.
- Diversifying from China: Traditionally, Tesla’s Shanghai plant supplied right-hand drive vehicles. This shift to Germany signifies a potential decrease in dependence on China, with India possibly becoming a future RWD (Right-Wheel Drive) manufacturing hub.
Scouting for a Manufacturing Base:
- A $2 Billion Investment: A Tesla team is expected to visit India this month to evaluate potential manufacturing plant locations. States like Maharashtra, Gujarat, and Tamil Nadu are vying to attract the electric car giant.
- Beyond the Factory: Tesla plans to invest beyond the $2 billion earmarked for the factory, focusing on establishing a robust charging network across India.
The New EV Policy and Model Options:
- Lower Import Duty, But with Strings Attached: Tesla previously lobbied for reduced import tariffs on fully built-up (CBU) models to gauge market demand. The new policy offers a compromise.
- Importing for Testing: Tesla can import 8,000 vehicles at a reduced 15% duty, but with a significant caveat: a minimum investment of $500 million (around Rs. 4,150 crore) in the Indian market is mandatory.
- Local Production and Domestic Focus: To qualify for the reduced import duty, Tesla must establish domestic manufacturing within three years and transition to local operations.
- Potential Model Lineup: Reports suggest Tesla might introduce the Model Y and Model 3 sedans in India.
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