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Photographer: Angel Garcia / Bloomberg
Photographer: Angel Garcia / Bloomberg
Tesla Inc. concludes agreement to manufacture electric vehicles in India for the first time, opening up a new growth opportunity after production begins in China.
Tesla has chosen Karnataka, a southern state whose capital is Bangalore, for its first factory, the state’s chief minister said over the weekend. The automaker has been negotiating with local authorities for six months and is actively considering assembling cars on the outskirts of Bangalore, people familiar with the matter said.
Tesla did not immediately respond to requests for comment and did not confirm the minister’s statement.
The company is conducting due diligence for office real estate in the area and is considering setting up an R&D facility, the people said, asking not to be named as the matter is private. Tesla focused on Bangalore because it shapes until to be a hub for electric vehicles and aerospace manufacturing talent, they said. Tesla incorporated its Indian unit and head office in downtown Bangalore.
CEO Elon Musk has all but confirmed that Tesla will enter India in January after months of speculation. Richest man in the world on January 13 tweeted “as promised” in response to a reports on a Tesla blog that the automaker was in talks with several Indian states to open an office, showrooms, research and development center – and possibly a factory.
This revelation sparked euphoria among locals, like Nikhil Chaudhary, a 20-year-old student at the University of Delhi who helped start India Tesla Fan Club in 2019.
Despite the hype, Tesla’s foray into India may well prove difficult. The country is yet to roll out the welcome mat for electric vehicles like neighboring China, where Tesla has set up its first factory outside the United States and now dominates sales of premium electric vehicles.
Electric vehicles account for about 5% of annual car sales in China, according to BloombergNEF, compared to less than 1% in India.
According to the International Energy Agency, around 60% of public slow and fast charging stations can be found in China. As Chinese automakers roll out competitive electric vehicle models and develop a diverse ecosystem, the country is “heading towards disrupting the current global automotive industry landscape,” analysts at UBS Group AG wrote in a report. last month.
A Model 3 vehicle leaves an assembly line during a ceremony at Tesla’s Gigafactory in Shanghai, December 2019.
Photographer: Qilai Shen / Bloomberg
India has taken similar steps, but not yet on the same scale.
In 2015, he launched a plan for the adoption and faster manufacture of hybrid vehicles and electric vehicles (FAMEs), with a pledge of 9 billion rupees ($ 123 million) for grants that cover everything from tricycles electric buses, according to the IEA. A The second generation of the FAME program introduced in 2019 was larger, with Rs 100 billion to encourage purchases of electric vehicles and build charging infrastructure.
India also reduced the goods and services tax on electric vehicles to 5% from 12%, as of August 2019, far less than the 28% taxes imposed on other motor vehicles, which have sparked criticism from companies such as Toyota Motor Corp.
Read more: India has 150 million drivers and only 8,000 want electric cars
– With the help of Bruce Einhorn, Ragini Saxena and Vlad Savov
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