Tesla launches Model Y in India with elevated price tag amid high tariffs
The electric carmaker announced the price on Tuesday.
Deliveries are estimated to start from the third quarter, the US automaker is targeting a niche electric vehicle segment in India that accounts for just 4 percent of overall sales in the world's third-largest car market.
It will compete mainly with German luxury giants such as BMW, Mercedes-Benz and South Korea's Kia rather than domestic mass-market EV players such as Tata Motors and Mahindra Auto.
On Tuesday, Tesla opened its first showroom in Mumbai and began taking Model Y orders on its website, marking its long-awaited entry into the market where Musk once had plans to open a factory.
For now, Tesla will import cars into a country where tariffs and related duties can exceed 100 percent, driving up the price for consumers.
Tesla's Model Y rear-wheel drive is priced at about $70,000 (6 million rupees), while its Model Y long-range rear-wheel drive costs roughly $79,000 (6.8 million rupees), according to the website.
Tariff pressures
The prices include the tariff and additional levies imposed by the state. There was no breakdown of the price on the website and Reuters could not immediately ascertain the listing price.
They compare with a starting price from $44,990 in the US, $36,700 (263,500 yuan) in China, and $53,700 (45,970 euros) in Germany.
At the media-only event at the showroom, Tesla displayed two Model Y cars made in China and its supercharger, which it will install at eight different locations in Mumbai and in and around New Delhi, where it is also expected to open its next showroom.
'We are here to create the ecosystem, to invest in the necessary infrastructure, including the charging infrastructure,' Isabel Fan, a regional director at Tesla, said at the launch event.
'We are building from 0 to 100. It will take time to cover the whole country.'
Grappling with excess capacity in global factories and declining sales, Tesla has adopted a strategy of selling imported vehicles in India, despite the duties and levies.
The US EV maker has long lobbied India for lower import tariffs on cars, and Prime Minister Narendra Modi's officials remain in talks with US President Donald Trump's administration to lower the levies under a bilateral trade deal.
Tesla's US factories also do not currently make the right-hand drive vehicles that are used in India.
Although India's road infrastructure has improved, traffic discipline – like lane driving – is still rudimentary, EV chargers are far and few and stray animals, including cattle, and potholes on the road are a big hurdle, even in cities.
'In the future, we wish to see R&D and manufacturing done in India, and I am sure at an appropriate stage, Tesla will think about it,' Maharashtra Chief Minister Devendra Fadnavis told reporters outside the new Tesla outlet.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Al Jazeera
a day ago
- Al Jazeera
Tesla finally parks in India. But can it survive the tariff war?
New Delhi, India – Tesla is finally cruising in India, the world's third-largest car market, with the launch of its Model Y. The rollout marks the culmination of a decade-long, topsy-turvy journey. Showcased at its new showroom in Mumbai, India's financial capital, on Tuesday, Tesla's Model Y is now on sale for about $70,000, a price comparatively higher than in any other major market. Elon Musk's electric vehicle (EV) company is braving high tariffs and stiff competition in India's nascent but rapidly expanding EV market. As New Delhi negotiates a trade deal with the United States, India's car sector tariffs, arguably among the highest in the world, are a central topic. 'Tesla's entry into India marks a significant expansion of the company's global footprint,' said Kwan Wongwetsawat, a senior auto analyst at the research firm GlobalData. 'Before this decision, Tesla faced several market challenges,' he said, ranging from geopolitical concerns, a decline in global sales, and an uncertain launch schedule for a new compact model. So, what's the buzz about Tesla coming to India? Can it leverage the developing Indian market? And can India give a shoulder to Musk's EV giant as its global sales plummet? What is Tesla offering in India? To start with, in India, Tesla has chosen to offer its Model Y in the mid-range luxury segment, combining its hallmark features: minimalist design, high performance, and long-range driving distance. The driver-assistance technology is available as an add-on for 600,000 Indian rupees, or $7,000. Tesla is offering two variants of Model Y in India: the rear-wheel drive (RWD) and the long-range RWD edition. While the RWD has a range of up to 500 kilometres (310 miles) on a single charge, the long-range variant has a range of 622km (386 miles). In the Indian market, the Model Y will go head-to-head with other premium electric SUVs, such as the Mercedes-Benz EQB, BMW iX1, Volvo EC40, and Kia EV6. Tesla offers a four-year, or 80,000km, vehicle warranty for the battery and drive unit, whichever comes first. 'Tesla is the biggest EV company in the world, and its entry in India is a big milestone for the national EV industry,' said Puneet Gupta, who leads the India and Southeast Asia teams at automotive intelligence firm S&P Global Mobility. 'It's not just about selling cars in India. But Tesla's entry can help India to build the EV ecosystem,' Gupta told Al Jazeera. 'And the biggest impact of a company like Tesla is that it boosts people's confidence in EVs as a category.' The Model Y reaches a top speed of 201km/h (125mph), with six coloured exterior finishes. It is equipped with standard features such as automatic emergency braking, forward collision alerts, blind spot monitoring, and lane departure warnings. Tesla's signature Dashcam and Sentry Mode provide real-time recording and alerts for suspicious activity, even when the vehicle is parked. Why is Tesla so expensive in India? Tesla's Model Y rear-wheel drive is priced at 6 million Indian rupees, or $70,000, while the long-range RWD edition is priced at about 6.8 million Indian rupees, or just below $80,000. Tesla's website does not provide the price breakdown, including delineating the additional import tariff costs and levies imposed by a state. These prices for Model Y are higher than in any other major car market. They start at $44,990 in the United States, $36,700 in China, and $53,700 in Germany. India currently imposes one of the highest import duty tariffs on fully built cars in the world, significantly shooting up prices of foreign vehicles, including EVs like those from Tesla. Until recently, India imposed a 110 percent import duty on all fully built vehicles. The Indian government revised this policy, lowering the import duty to 15 percent for carmakers committing to invest and set up local manufacturing facilities within a three-year timeframe. This steep tariff structure has been a point of contention for global carmakers like Tesla, which has long lobbied for a reduction in duties to test market viability before committing to local manufacturing. US President Donald Trump has repeatedly criticised and called out India as a 'tariff king'. Both countries continue to negotiate a trade agreement, where the auto sector reportedly remains a central focus. Musk, Tesla's CEO, has also noted that 'import duties [in India] are the highest in the world by far of any large country!' What is India's EV sector like? India has set a national goal of achieving 30 percent EV adoption by 2030. While electric car sales in India increased by 20 percent in 2024 from the year before, EVs still represented just 2.5 percent of the total 4.3 million passenger vehicles sold. Despite its relatively small base, the EV sector in India is projected to grow rapidly, from its current market value of $54.41bn to $111bn by 2029. Currently, local manufacturers dominate the space, offering competitively priced EVs tailored to India's cost-conscious consumers. Tata leads with approximately 60 percent of the market share in the electric car segment, followed by JSW MG Motor India – a collaboration between India's JSW Group and China's SAIC Motor – and then Mahindra & Mahindra. High-end electric cars, priced above $20,000, made up a minuscule 6.6 percent of total EV sales last year. This is where Tesla will have to compete with the likes of Mercedes-Benz, BMW, KIA and Audi. How are Tesla sales faring in other markets? Tesla is coming to India as its EV sales plunge in global markets, and as the company bets on its revised Model Y to turn its fortunes around. In its home market, the US, sales continued to fall in the second quarter of 2025 by 6.3 percent, marking Tesla's third straight quarterly drop in year-over-year domestic sales. Facing protests against Musk's politics and earlier involvement with the Trump administration, sales have fallen for five straight months in Europe. With some consumers switching to cheaper Chinese EVs, Tesla's market share has dropped to just 1.2 percent in May from 1.8 percent a year ago. In China, Tesla's second-biggest market, the Q2 deliveries fell by nearly 12 percent. 'Tesla has been facing tough times globally, so the company also desperately wants new markets, and India, being the world's third-largest market, is a great opportunity for them to make up for some loss,' said Gupta of S&P Global Mobility. In several countries, Tesla's Chinese competitors are outselling Musk's EVs. And that's where the vast Indian market comes into the equation for Tesla, noted experts. Due to geopolitical tensions between India and China, rival Asian neighbours, only a few Chinese EVs are pitching to the Indian market. In 2023, the Indian government rejected BYD's proposal to establish a $1bn factory locally. While SAIC Motor operates in India in collaboration with India's JSW Group, BYD relies on importing multiple models. 'BYD is a direct competitor to Tesla, but the brand is also facing challenges in India and has yet to establish local production in the country,' said Wongwetsat. As a result, he added that both Tesla's prices in India and those of BYD are higher than in other markets. 'However, there is a clear price distinction between Tesla and local competitors like Tata, MG, and Mahindra,' placing Musk's company in the luxury segment. Unlike other Chinese-dominated EV markets in Asia, India offers a rather open market for Tesla to introduce high-end features and build an ecosystem from the ground up. 'The Chinese companies are not comfortable investing in India, and even Indian consumers are not comfortable buying Chinese due to the uncertain geopolitical situation,' said Gupta. 'For now, the Indian market's positioning is a very good advantage for Tesla, where you really don't get competition from Chinese, which is really killing Tesla both in terms of price and features,' Gupta told Al Jazeera. What challenges does Tesla face in India? For starters, India, which has the world's biggest population, is a starkly unequal country, where 90 percent of the population does not have discretionary spending capacity. Tesla's base offering is priced at $70,000, where, on a national average, per capita income is $2,880. Another concern is that India's infrastructure, including the condition of its roads and poor traffic discipline, could pose challenges for Tesla vehicles' lower ground clearance. India has only one charging station for every 235 EVs, with a total of 26,367 public charging stations nationwide for its 1.46 billion people. In contrast, the US has more than 61,000 charging stations for its 330 million people. At its media-only launch in Mumbai on Tuesday, Isabel Fan, Tesla's regional director, said, 'We are here to create the ecosystem, to invest in the necessary infrastructure, including the charging infrastructure.' Tesla announced that it will set up four charging stations in Mumbai. More will come to Delhi soon. 'We are building from 0 to 100. It will take time to cover the whole country,' Fan said. Reading into the Indian EV market, Wongwetsat of GlobalData said that 'Tesla's arrival may not significantly impact overall battery electric vehicle (BEV) sales in India, but it could attract demand from consumers interested in luxury brands like BMW and Audi.' Additionally, the launch of Tesla cars in India may be just one aspect of Tesla's broader ecosystem, Wongwetsat said, which includes sectors such as solar energy, energy storage systems, and even the space industry, all of which could enhance Tesla's appeal. Will Tesla lose subsidies in the US? Musk and the US president's apparent public fallout took a sharp turn earlier this month as Trump threatened to cut off billions in federal environmental subsidies that have benefitted Tesla and Musk's other companies. The clash follows Musk's renewed criticism of Trump's tax and spending bill, which includes provisions to eliminate key clean energy incentives – specifically, the $7,500 consumer tax credit for electric vehicles that has long supported Tesla's market growth. Trump, responding to Musk's criticism, warned that the Tesla CEO could 'lose a lot more' than just EV incentives. The dispute has broader implications. Musk has threatened to fund campaigns against lawmakers who back the bill and even floated the idea of launching a new political party.
Al Jazeera
a day ago
- Al Jazeera
India's ban on Jane Street raises concerns over regulator role
Indian tax authorities and market regulator are considering widening their probe of United States trading giant Jane Street Group to investigate it for tax evasion in addition to an earlier charge of price rigging in the Bombay Stock Exchange's benchmark Sensex, according to media reports. The tax evasion charge comes on the heels of market regulator, the Securities and Exchange Board of India (SEBI), seizing 48.43 billion rupees ($570m) and banning four Jane Street-related entities from operating in the market for alleged price manipulation in the National Stock Exchange (NSE). SEBI's order has roiled the Indian markets, raising questions about regulator surveillance and investor protection in the world's largest options trading market. Trading in India's weekly equity index options has slumped by a third on the ban on Jane Street, the Reuters news agency reported on Thursday. Trading of equity options lets investors buy or sell a stock at a predetermined price and date. As the Indian market rapidly grew to handle more than half of all global options trades, retail investors entered the market too. Questions of price manipulation have dogged this rapid rise but remained vacuous until a New York court case in April 2024, where Jane Street alleged that its rival, Millennium Partners, had stolen its algorithms that helped it make in the Indian options market. A whistleblower, Mayank Bansal, then made presentations to SEBI showing Jane Street's trading patterns. Bansal had agreed to speak to Al Jazeera about his interaction with SEBI on the matter, but then backtracked. On July 3, in a detailed interim order, the regulator said that 'by preponderance of probability, there is no economic rationale that can account for this sudden burst of large and aggressive activity … other than the intent to manipulate the price of securities and index benchmark'. SEBI has alleged that Jane Street accumulated large long positions in stocks that are a part of the NSE's Bank Index and built large short positions in index options at the start of trade. Around market closing time, it would reverse its trades in the cash and futures segments, pushing down the index and earning large profits in the options segment. This activity was blurred by its offshore entities making some of these trades. 'Lawyers [can] push back with SEBI on jurisdiction-related issues, but when underlying [Indian] securities are issued, SEBI can take action,' Joby Mathew, managing partner at the law firm Joby Mathew and Associates and a former legal officer at SEBI, told Al Jazeera. Jane Street has disputed SEBI's findings and has hired lawyers to represent it before SEBI in the case. It has deposited the 48.43 billion rupees ($563m) of allegedly ill-gotten gains in an account pending the investigation and final report. 'Such processes typically take eight to 24 months,' especially in 'complex manipulation cases', Sumit Agarwal, a former SEBI officer and cofounder of Regstreet Law Advisors, told Al Jazeera in an emailed response. But the investigation can only be part of a broader questioning of Jane Street and the regulator's role in identifying and curbing such trades sooner and protecting retail investors. 'Highly speculative and volatile' As India's options market grew, retail investors were drawn to it, enticed by the growing volumes, the prospect of quick gains and less fettered trades than the equities market, where a rapidly rising stock could hit circuit breakers, leading to a halt in trading to prevent manipulation. Mathew says his clients from the options trading segment range from students to award-winning cardiologists who may not have a refined knowledge of the market but were sold on the idea by traders or social media influencers. Most ended up losing money. Deven Choksey, managing director at the Mumbai-based stock brokerage KR Choksey Shares and Securities, says retail investors form nearly half the Indian options market, while Jane Street and other sophisticated institutions form a little more. 'It's like a bullock cart facing a race car. Their meeting is bound to cause accidents.' If Jane Street is found to have manipulated the market, its earnings would have come through losses for retail investors. Bhargavi Zaveri, a financial regulations researcher formerly at the National Institute of Public Finance and Policy and currently a doctoral researcher at the National University of Singapore, says retail investors have made losses in the options segment, but the total amount is not clear. Identifying and compensating investors can be hard in such cases. So even if the final order goes against Jane Street and the 48.43 billion rupees fine goes into an investor protection fund, it may be hard to distribute it onwards to retail investors who incurred losses. The best protection may be to stem irregular trades early, experts say. 'SEBI has a surveillance system and they can well monitor the markets in a timely way.,' says Choksey. SEBI's interim order is based on trades made by Jane Street between January 1, 2023 and March 31, 2025, a period in which retail investors may have incurred substantial losses, going by SEBI's estimates. Regstreet's Agarwal says, 'SEBI's own 2024 consultations flagged expiry day options as highly speculative and volatile.' India has fortnightly expiry dates for options, which is when they have to be settled. That is when Jane Street allegedly manipulated prices. In a February 6 letter, SEBI told Jane Street, 'The above trading activity prima facie appears to be fraudulent and manipulative.' But it did not issue its order curbing Jane Street until July 3. SEBI's recent measures limiting weekly expiries, tightening spreads and higher margins 'reflect a push for greater protection' for retail investors, Agarwal says. But the best way to protect retail investors would be to have them trade separately from proprietary trading firms in the options segment, Choksey points out. 'India is unique … and in no market will you see so many retail investors. So, SEBI must create product differentiation by customer segment.' to protect retail investors Chiksey says. Challenges in proving manipulation In an internal email, Jane Street reportedly told employees it was using 'basic index arbitrage trading' and called SEBI's allegations 'extremely inflammatory'. It has hired Mumbai-based law firm, Khaitan and Co, to represent it before SEBI. Proving price manipulation involves showing intent, which can be hard, and experts are divided on whether a SEBI investigation will be able to demonstrate that. 'Trading to incur losses makes no sense, and so it indicates manipulation,' says Mathew, the former legal officer. But NUS's Zaveri says it is not so clear. 'I think three problems are being conflated here. One, the size of the options segment being manifold the underlying cash segment. Two, that retail investors have made losses on the options segment, which I'm not sure have been quantified. Three, Jane Street arbitraged between an illiquid cash and highly liquid options segment.' According to her, the three occurrences may not prove the intent to manipulate. Under Indian law, proving manipulation is challenging and 'Jane Street can argue its expiry day trades were legitimate index arbitrage recognised by regulators, making a manipulation finding difficult without clear intent evidence,' Regstreet's Agarwal says. Any action by SEBI could affect Jane Street's reputation. Last month, an investigation by Bloomberg found that Jane Street cofounder Robert Granieri was duped into funding weapons for an attempted coup to overthrow the government in South Sudan. If SEBI's final order lays out any action against Jane Street, 'they may well have to disclose it in their filings, which will affect them elsewhere in the world', says Mathew.
Al Jazeera
2 days ago
- Al Jazeera
Brazil's Lula slams Trump, says there is no ‘logic' to US tariff threat
Brazilian President Luiz Inacio Lula da Silva has said that his country will not take instructions from the United States after US President Donald Trump threatened Brazil with 50 percent tariffs and called for an end to the trial of right-wing ally Jair Bolsonaro. In an interview with CNN on Thursday, President Lula said that the tariffs have no 'logic' but that he does not believe there is a 'crisis' in relations between the US and his country as of yet. 'For me, it was a surprise, not only the value of that tariff, but also how it was announced, the way it was announced,' Lula said. 'We cannot have President Trump forgetting that he was elected to govern the US, not to be the emperor of the world.' The US president's heavy-handed approach to economic relations with other countries has chafed foreign leaders such as Lula, who has expressed frustration at what he sees as Trump's efforts to dictate terms to Brazil on matters of trade and domestic judicial proceedings. Bolsonaro, the former president of Brazil who has close ties with Trump and his family, is currently on trial for alleged efforts to mount a coup and reverse Lula's victory over him in the 2022 election. Trump, who also faced legal trouble stemming from his efforts to remain in office after losing an election, has called the trial a 'witch hunt' and demanded that it come to an end. He has recently done the same for another right-wing ally, Israeli Prime Minister Benjamin Netanyahu. 'The judiciary branch of power in Brazil is independent. The president of the republic has no influence whatsoever,' Lula said, stating that Bolsonaro 'is not being judged personally', but 'being judged by the acts he tried to organise a coup d'etat'. The US has also warned Brazil that it will be penalised with higher tariffs if it continues its work as a leading member of BRICS, a coalition of developing economies that have sought to promote alternatives to the US-backed global financial system. Trump has attacked the group for 'anti-Western priorities' and threatened higher tariffs for any countries involved with the bloc. In Latin America, where the US has a long history of heavy-handed involvement in the domestic affairs of various nations, Trump's threats and blunt use of US economic leverage have sparked anger. 'Brazil is to take care of Brazil and take care of the Brazilian people, and to take not to take care of the interests of the others,' Lula said. 'Brazil will not accept anything imposed on it. We accept negotiation and not imposition.'
