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For years, Indian citizens have pleaded with Tesla CEO Elon Musk about the possibility of the electric automaker building and delivering cars to the country. India, a vast landmass where 1.366 billion people live, has less than 1% of its 30 million electric cars, the most sustainable way to run a vehicle. However, Tesla aims to change that with an imminent entry into the Indian market. The problem is that Tesla’s road to India could end before it even starts, which would be a big blow to the company and its supporters in the country, as Tesla fans have waited several years for any indication that the automaker. automobile would finally make an appearance. in their part of the world. But, strict regulations and internal political interests stop this possibility, and people are wondering if the world’s leading electric car maker will ever enter the Indian car market.
Many of you who read Teslarati on a daily basis, you should know that we have been monitoring the situation in India since the early days. In fact, one of my first articles from 2021, as I recovered from COVID-19 in January, was about Tesla’s potential in Indian markets. Additionally, it looked like some potential customers would be ready to order their first all-electric cars from the Silicon Valley-based electric car company by the time the second quarter rolls around. However, Musk’s outlook was not respected as the Indian government halted any attempt by Tesla to bring its products into the country without the high import duties. Sadly, it doesn’t look like they are leaving soon either, as Prime Minister Narendra Modi, who has strongly supported the idea of home-made efforts, will not be forced to quit his post or participate in another election. before 2024.
While local manufacturing is something Americans take great pride in, especially with cars, there are definitely benefits to building things nationally. First, companies must hire workers in the country where the company is located. Second, increasing manufacturing jobs not only improves the U.S. economy, but also provides job security for the millions of employees who are on assembly lines 40 hours (or more) a week. There are a lot of strengths in local manufacturing, but there is also room for foreign entities to bring their products to a market, especially if they can benefit a foreign economy like it does a domestic economy.
Musk with Modi in 2015
This is something Tesla backed in his proposal letter to the Indian government a few weeks ago when it called for a reduction in import duties. Increasing Tesla’s imports would actually help the country develop a charging infrastructure, which would provide jobs for the energy sector and provide cleaner transportation options in a country where the climate and environment are struggling. with smog and emissions. Additionally, Tesla would need a dedicated service center in multiple locations as India is a big country. Not to mention that the showrooms would also offer employment opportunities.
Musk said Tesla wouldn’t bring a Gigafactory to India without some sort of data that supports healthy demand, which is obviously necessary to justify building a nearly $ 1 billion production plant in India. Doing this through imports is a great idea, but 60% import taxes on vehicles under $ 40,000 and 100% duties on vehicles over $ 40,000 and over simply won’t help. do it. Clear and simple. There must be movement from the Indian government side.
However, Indian politicians fail to realize that the economic and environmental benefits of having electric vehicles in the country will be a better decision in the long run. Instead, they’re not moving or even considering reducing import duties of any kind, at least so far, which seems to discourage Tesla’s demands to enter the market. It would be a shame if no solution can be found after this problem, because I believe that the only environmental impacts will be something that not only the Indian people will appreciate, but the people of the world will start to see eventually. As the air begins to clear and the smog disperses, India’s close relationship with gas and oil may be relatively appeased. Sustainable energy could make its way to India over the next few years, and Tesla could see the potential of its largest Gigafactory in India.
Think about the economic benefits that a large-scale production facility could offer. Not only would that produce good paying jobs, but it would also create a lot of them.
There are so many benefits for Tesla and India if a deal can be made. But can he? In my opinion, Tesla might be better off delaying the operation in India for a few more years, when a new administration and new ideas can be launched on Tesla’s entry into the market. It seems, for now, that there aren’t many possibilities, and Tesla might be better off expanding its efforts in the UK or elsewhere.
That being said, I would like to know what you think of this issue. Is Tesla wasting his time trying to make a difference in India? Should he try again in a few years? Do you think that progress can be made? Why or why not? If not India, where should Tesla consider a new Gigafactory?
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I use this newsletter to share my thoughts on what’s going on in the Tesla world. If you want to talk to me directly, you can email me or reach me on Twitter. I don’t bite, be sure to reach out!
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