Tesla Would Like To Enter The Indian Market, If Not For Exorbitant Taxes

Elon Musk has suggested that Tesla has an interest entering into the Indian market following an announcement from the government that it will start building large factories for lithium-ion battery production.

Tesla doesn’t currently sell its vehicles in India due to the huge import duties.

Taking to Twitter, Elon Musk and Tesla Club India revealed that, for vehicles over $40,000, the import duty into India is 100 per cent, something which would make the car manufacturer’s vehicles exorbitantly expensive. However, Musk added that recent changes in sales tax “give hope for future changes.”

Also Read: India Really Wants A Tesla Factory, But Musk Is Far From Convinced

A couple weeks after Musk’s comments on Twitter, local financial newspaper Mint reports that the Indian government wants to make the country a global manufacturing hub for electric vehicles and their components. India is the world’s third-largest crude oil importer and current plans call for multiple 50-gigawatt hour factories to be built across the country.

The Indian government has been keen to attract Tesla to its shores for years. In 2015, Prime Minister Narendra Modi visited Tesla’s factory in California and the following year, transport minister Nitin Gadkari also paid a visit to the electric car manufacturer. That same year, Tesla’s former chief information officer Jay Vijayan, who was born in India, visited the country to investigate the opportunity of importing their vehicles. It is believed the government is particularly keen for the automaker to build one of its Gigafactories there.

Prior to commencing the construction of its Gigafactory in China, Tesla started exporting its vehicles to the nation despite the high import taxes they were hit with. There’s no official word whether a similar strategy could be followed, but given the country’s size and all the aforementioned factors, we wouldn’t rule out anything.

I’m told import duties are extremely high (up to 100%), even for electric cars. This would make our cars unaffordable.

— Elon Musk (@elonmusk) August 1, 2019

For other countries, we pay in part for the local factory by selling cars there ahead of time. Also, gives a sense of demand. Current rules in India prevent that, but recent changes in sales tax give hope for future changes.

— Elon Musk (@elonmusk) August 1, 2019