Unfazed by impending entry of Tesla, new EV policy has safeguards: Merc-Benz India

NEW DELHI: German luxury carmaker Mercedes-Benz is unfazed by the likelihood of Tesla entering India with imported electric cars at much lower duty and believes that the country’s new EV policy has safeguards for existing players, a senior company official said on Thursday.

While the entry of the likes of Tesla and VinFast will help expand the market and accelerate EV adoption in India, MercedesBenz is confident to maintain leadership in the luxury EV space as the new entrants would play in the lower segment.

“I think new competitions and new players are always welcome. It helps to expand the market, spread more awareness, which is also the need of the hour to get more EV penetration,” Mercedes-Benz India MDCEO Santosh Iyer said.

He was responding to a query on the implications of India’s new EV policy and if it puts manufacturers which have already invested in the country at a disadvantage.

“Any duty-free or any reduced-duty tariffs are always welcome because we have always been advocating free trade in India and globally. So for us, any such things are welcome,” he said. Iyer further said, “We have to go deeper into the policy and check the implications but there are caps and ceilings and there are safeguards put in by the government. So at this stage it is not a major threat that we see for our business.”

Under the new EV policy, companies that would set up manufacturing facilities for EV passenger cars will be allowed to import a limited number of cars at lower customs/import duty of 15 per cent on vehicles costing $35,000 and above for a period of five years from the date of issuance of the approval letter by the government. At present, cars imported as completely built units attract customs duty ranging from 70 per cent to 100 per cent, depending on the type of fuel, engine size and cost, insurance and freight value below or above $40,000.

The policy seeks to promote India as a manufacturing destination for EVs and attract investment from reputed global EV manufacturers. On Wednesday, Tesla CEO, Elon Musk confirmed his visit to India and his planned meeting with Prime Minister Narendra Modi. He is expected to announce the company’s investment plans in the country during his visit in the week of April 22. Iyer reiterated that MercedesBenz is committed to the development of the EV market in India.

Merc-Benz is confident to maintain leadership in the luxury EV biz as new entrants in lower segment