Is Tesla stalling on India? Market entry appears in doubt after minister questions intent
Tesla's long-anticipated push to manufacture cars in India appears to be stalling, after a senior minister cast doubt on the company's intent – raising fresh questions about whether the electric vehicle giant is ready to commit to one of the world's fastest-growing car markets.
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The remarks have highlighted a mismatch between India's policy efforts to attract global carmakers and Tesla's hesitant approach to committing new manufacturing investment – even as analysts believe the firm is still positioning itself for a longer-term play in the country.
Speculation over the US electric vehicle giant's expansion had mounted in recent months following favourable import duty cuts, alongside the opening of a Tesla showroom in Mumbai.
But in comments that undercut the excitement, India's Minister for Heavy Industries H.D. Kumaraswamy told reporters in Delhi on Monday that Tesla was 'more interested' in establishing showrooms and 'not interested' in manufacturing in India.
The statement quickly sparked debate on social media, where some users argued that Tesla might be delaying its entry because it already had ample production capacity elsewhere. Others suggested the high price point of its cars limited the company's addressable market in India.
A Tesla showroom showcases a Model Y vehicle. Tesla CEO Elon Musk has previously cited India's high tariffs as a key obstacle to entering the market. Photo: TNS
India has taken notable steps to court Tesla. In its February budget, the government slashed tariffs on luxury vehicles priced above US$40,000 from 125 per cent to 70 per cent. It had earlier offered a separate pathway for carmakers to pay just 15 per cent in import duties – if they committed to investing at least US$500 million and building a local factory.
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