Tesla plans to set up electric car production plant in south India
The electric carmaker incorporated Tesla Motors India and Energy Private Limited with its registered office in Bengaluru in Karnataka state last month
Billionaire Elon Musk’s Tesla will set up an electriccar manufacturing unit in the southern Indian state of Karnataka, according to a government document seen by Reuters on Saturday.
“The US firm Tesla will be opening an electric car manufacturing unit in Karnataka,” the state government said in a brief statement.
The statement was part of a broader document outlining the highlights of India’s budget to its people in the local language of Kannada.
Last month, the electric carmaker incorporated Tesla Motors India and Energy Private Limited with its registered office in the city of Bengaluru in Karnataka, a hub for global technology companies.
State Chief Minister B.S. Yediyurappa had then said in a tweet, which was subsequently deleted, that Tesla would start its operations in India with an R&D unit in Bengaluru.
It was not immediately clear if the Saturday statement was referring to the same unit.
Tesla and the office of Karnataka state chief minister did not immediately respond to Reuters’ request for comments.
Musk has tweeted several times about the company’s impending foray into India. In December, the Tesla CEO confirmed in an exchange on Twiter that Tesla will launch in the country in 2021.
India has been keen to reduce its oil dependence and cut down on pollution, but its efforts to promote electric vehicles have been stymied by a lack of investment in manufacturing and infrastructure such as charging stations.
To boost investment, India plans to offer $4.6 billion in incentives to companies seting up advanced battery manufacturing facilities, Reuters reported last year.
Meanwhile, Bitcoin took another large stride toward mainstream acceptance on Monday ater billionaire Elon Musk’s electric vehicle company Tesla revealed it had purchased $1.5 billion of the cryptocurrency and would soon accept it as a form of payment.
The announcements, buried deep in Tesla’s 2020 annual report, drove a 10% surge in the world’s most widely-held cryptocurrency. Investors anticipated other companies will soon join a list of firms that invest in or hold bitcoin including Blackrock Inc, the world’s largest asset manager, and payments companies Square and Paypal.
Musk has upended Wall Street over the last year and briefly became the world’s richest person as shares of Tesla surged nearly 500% to become the fith most-valuable US company, leaving other companies and investors eager to follow in his wake.
“If any lesser mortals had made the decision to put part of their balance sheet in Bitcoin, I don’t think it would have been taken seriously,” said Thomas Hayes, managing member at Great Hill Capital in New York. “But when the richest man in the world does it, everyone has to take a second look.”
The news sparked heavy trading in cryptocurrencies and caused exchanges like Coinbase, Gemini, Binance to experience technical issues, according to Coindesk,
A well-known supporter of cryptocurrencies, Musk has weighed in regularly on the past month’s frenzy in retail investment, also driving up prices of the meme-based digital currency dogecoin and shares of US video game chain Gamestop.
He said a week ago that bitcoin was “on the verge” of being more widely accepted among investors, and in December asked if it was possible to do large transactions in the currency.
In late January, Musk changed the bio of his Twiter account, which has 46 million followers, to include #bitcoin.
Tesla said in a filing the decision was part of its broad investment policy as a company and was aimed at diversifying and maximizing its returns on cash, including holding gold. The report said it ended 2020 with $19.38 billion in cash and cash equivalents.
“We expect to begin accepting bitcoin as a form of payment for our products in the near future, subject to applicable laws and initially on a limited basis, which we may or may not liquidate upon receipt,” the company said.
Tesla said it had invested an aggregate $1.5 billion in bitcoin under the changed policy and could “acquire and hold digital assets from time to time or long-term”. Gold jumped more than 1% Monday while ethereum, another cryptocurrency, surged to a record high.
Central banks remain skeptical of digital currencies, but analysts say the more real world uses appear for bitcoin, the more attractive it will prove as a long-term store of value.
Bitcoin surged more than 10% to a record high of $43,625 ater Tesla’s disclosure.
“The argument for bitcoin is evolving. It used to be negative (reasons to buy) but suddenly there are positive reasons, and that’s why you see bitcoin at ( new highs),” Mohamed El-erian, chief economic advisor of Allianz, told CNBC.
Tesla is the latest company to add bitcoin to its corporate treasury, following similar moves by Square, the payments company led by Twitter Inc chief Jack Dorsey and US sotware firm Microstrategy.