Tesla, the pioneering electric vehicle (EV) manufacturer spearheaded by Elon Musk, has commenced production of right-hand drive cars destined for the Indian market at the Gigafactory Berlin. Anticipating a swift timeline, the company aims to introduce these vehicles to the Indian market by year-end, as reported by Hindustan Times.
Earlier, on April 3, the Financial Times of Britain disclosed that Tesla plans to dispatch a team to India this month to explore the establishment of a ₹2-3 billion (₹16,000-₹25,000 crore) electric car manufacturing plant in the country.
The team’s focus for locating these electric car manufacturing plants will center on states renowned for automotive hubs, such as Maharashtra, Gujarat, and Tamil Nadu, according to the report. Although some vehicle manufacturers have plants in Haryana, Tesla’s preference for the other three states is primarily due to their strategically located ports, facilitating ease of car exports.
This development coincides with the Indian government’s recent approval of a new EV policy, aimed at positioning India as a prominent manufacturing hub for electric vehicles. Under the new policy, companies are required to make a minimum investment of ₹4150 crore, with no upper limit on investment.
Foreign car manufacturing companies entering the Indian market are mandated to commence manufacturing and commercial production of EVs within three years of initiating business in India, as per the policy guidelines. The Ministry of Commerce and Industry (MoCI) issued a notification to this effect on March 15.
Tesla’s plans also extend to manufacturing and selling battery storage systems alongside electric cars in India. The company has proposed this to Indian authorities, as per media reports.
In November of last year, Commerce and Industry Minister Piyush Goyal visited Tesla’s manufacturing facility in California. Though Elon Musk was absent during this visit, he expressed regret on the social media platform X. Musk conveyed his eagerness to meet Goyal on a future occasion.
During a meeting between Tesla CEO Elon Musk and Prime Minister Narendra Modi in New York in June last year, Musk expressed his enthusiasm for India’s potential and conveyed his admiration for Modi. PM Modi reciprocated the sentiment, tweeting a picture of their meeting and lauding their discussions on various topics.
In 2022, although Tesla expressed interest in entering the Indian market, discussions between the company and the government did not materialize. Tesla had sought a reduction in the import duty on fully assembled vehicles from 100% to 40%. However, the government maintained that there were no plans to waive or reduce import duty on electric vehicles imported from other countries unless Tesla committed to establishing a manufacturing plant in India. Musk insisted on selling cars in India first before considering the establishment of a plant.
