Tesla plots Indian site as Modi races to overtake China on EVS
ELON MUSK’S Tesla is exploring constructing a multibillion-dollar electric vehicle factory in India as the country’s prime minister seeks to put the brakes on China’s dominance.
Tesla is planning to send a team to India later this month to hunt for possible locations for the plant which could be worth as much as $3bn (£2.4bn), the Financial Times reported.
The electric carmaker’s hunt for an Indian factory site comes after officials in New Delhi agreed to cut tariffs on electric car imports for manufacturers which invest $500m in a plant in the country within three years.
A cut to tariffs, announced in March, had been a key demand from Tesla executives. Possible sites could include carmaking hubs in Maharashtra, Gujarat and Tamil Nadu.
Narendra Modi, India’s prime minister, has sought to boost the country’s domestic electric vehicle manufacturing capabilities. The industry is dominated by its regional rival China and Tesla has its largest “gigafactory” in Shanghai.
One of Tesla’s biggest rivals, China’s BYD, has also sought to expand into India, but its plans for a $1bn factory plant in the country were rejected by government officials, the Economic Times reported last year.
In addition to Shanghai, Tesla already has manufacturing plants in California, Texas and Berlin. It is also building a plant in Mexico, which will open in 2026.
Tesla has been looking to ramp up manufacturing of an electric car that costs less than $30,000. Tesla executives have told Indian government officials it could build a planned smaller, cheaper electric car in the country, The Times of India reported last month. The company could also look to build a battery plant in the country.
Shares in Tesla slumped by more than 5pc on Tuesday after it reported weaker than expected car sales.
A global slowdown in electric vehicle sales, driven by higher inflation and tepid demand, meant it shipped 386,810 cars in the three months ending in March, significantly down on the 422,875 in the same period a year earlier.