Elon Musk's Tesla not yet ready to commit to Make-in-India: Report

A delegation of Tesla Inc. executives recently held discussions in India regarding the possibility of local component sourcing and incentives. However, the talks did not include a proposal to establish a vehicle manufacturing plant in the country, according to a report by Bloomberg. After a gap of almost a year, Tesla resumed dialogues with the Indian government but did not present a plan for building vehicles in India.

The report, citing sources, revealed that Tesla wants to establish a domestic factory to tap into India's vast consumer market. However, the meetings did not offer any commitment from the automaker.

Tesla executives that met govt officials shared their concerns about India's high tariffs on imported cars. However, the government did not budge from its previous position to modify the existing tax regime to accommodate a single automaker.

Tesla is currently focusing on gaining a thorough understanding of local policies and incentives within the electric vehicle (EV) industry before finalizing its roadmap for India. The report claims that the company is engaging in a series of meetings with the Ministries of Power, Road Transport and Highways, and Heavy Industries.

Tesla has been facing headwinds in China due the current geopolitical tensions. India is posing itself as a viable alternative, both as a market and manufacturing destination. Apple recently doubled down in India by opening two retail stores in the country. The company plans to expand its production in India, in view of added strain to diversify from China. 

India not the only option?

Tesla is also looking to expand in other markets to achieve its diversification goals. The American automaker is looking into other Asian nations for potential factory locations. In November, CEO Elon Musk stated that South Korea is a leading candidate for investment, as confirmed by the office of President Yoon Suk Yeol. Musk also emphasized that any investment decision would be made following a comprehensive review of investment conditions, including factors such as manpower and technology.

Also read: Elon Musk's Tesla engages with Indian govt officials ahead of PM Modi’s US visit

Also read: 'Tesla will have its ChatGPT-moment': Elon Musk predicts major breakthrough by next year