News Brief
Tesla Nearing Agreement To Ship Electric Cars To India, Potential Factory Setup Also On The Horizon
Prime Minister Narendra Modi with Tesla CEO Elon Musk. (Wikipedia)
In a significant development, India is reportedly closing in on an agreement with Tesla, allowing the US automaker to ship its electric cars to the country starting next year.
The potential deal may also involve Tesla establishing a factory in India within the next two years, sources familiar with the matter revealed.
As per reports by NDTV, an official announcement is anticipated at the Vibrant Gujarat Global Summit scheduled for January.
Gujarat, Maharashtra and Tamil Nadu are being considered as potential locations due to their established ecosystems for electric vehicles and exports.
As part of the agreement, Tesla is expected to make an initial minimum investment of around $2 billion in the plant, with plans to increase auto parts purchases from India to as much as $15 billion.
The US automaker is also exploring the possibility of manufacturing some batteries in India to reduce costs.
Prime Minister Narendra Modi's government has been actively promoting domestic manufacturing of EVs to accelerate the adoption of cleaner transport.
Tesla's foray into India faces many challenges, including high import tariffs.
However, if the agreement materialises, locally made Tesla cars could potentially be priced as low as $20,000.
Trade Minister Piyush Goyal, who recently visited Tesla's plant in California, mentioned in September that Tesla plans to almost double its purchases of auto parts from India to $1.9 billion this year.
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