Tesla Opts for Showrooms, Not Manufacturing in India, Amid New EV Policy

Elon Musk's Tesla has decided to concentrate on establishing showrooms in India, rather than setting up manufacturing facilities, according to an announcement by Union Minister for Heavy Industries HD Kumaraswamy. This decision emerges even as other European car giants express significant interest in the Indian electric vehicle market, motivated by recent policy amendments.

This new development was further explained by Heavy Industry Secretary Kamran Rizvi, who indicated that Tesla's intentions will become clearer once formal applications are submitted for consideration. Despite the current stance of the electric vehicle leader, many European brands such as Hyundai, Mercedes Benz, Skoda, and Kia are eager to manufacture in India under the newly revised EV policy.

The policy, introduced in 2022, offers a reduced import duty of 15% for companies investing $500 million in Indian manufacturing plants. Additionally, firms are encouraged to increase their local sourcing from 25% to 50% within five years. However, Tesla previously expressed interest in the Indian market, with Musk citing high import duties as a major hurdle for the company's full-scale entry.

(With inputs from agencies.)