The eccentric billionaire, in response to a query by a Twitter user, revealed the reason for Tesla’s delayed entry into the Indian market
Elon Musk is quite an active personality on Twitter, where he often responds to inquisitive netizens. Recently, an Indian Twitter user asked Musk about updates on Tesla’s launch in India. In response, the Tesla CEO replied “Still working through a lot of challenges with the government [of India]”. Musk has been lobbying for reduced taxes on CBU-imported electric cars, which currently stand at 100 per cent duty.
Musk’s tweet has invited a sharp response from the Centre, with sources stating that he is using social media to build pressure on the government. The Centre revealed that Tesla can enjoy the benefit of zero import duty on CKD imports, which would require the manufacturer to set up local assembly plant(s). Also, India has a PLI scheme in place for automakers operating in the country, under which Tesla can avail benefits with local production.
Previously, Musk had tweeted that India had some of the highest import duties in the world. He also stated that the government was putting clean-energy EVs in the same bracket as fossil-fuel-powered cars, which isn’t ideal. The company had initially planned to check market response with fully-imported vehicles, to determine the feasibility of expanding operations in India.
Tesla’s call for lowering import taxes on EVs had received support from a few carmakers, including Volkswagen Group India and Hyundai Motor India. The latter has one electric vehicle in the Indian market – Kona EV – which is locally assembled, and it has plans to add a fully-imported EV to its range soon, followed by a made-in-India EV in a few year’s time.
Nitin Gadkari, Union Minister for Road Transport and Highways, has been pushing Tesla for local manufacturing for a while now. The minister has publicly announced that he wants Tesla to build cars in India, and that benefits would be offered to the manufacturer for the same. The company, however, is still wishing to test the waters first with imported cars before such a commitment.
Tesla has already homologated seven models in India, which likely include multiple variants of the brand’s Model 3 and Model Y EVs. Both these vehicles have been spotted in the country on road tests multiple times now.