Tesla has received approval to make or import four models in India, inching closer to its official debut in the country. A posting on the Ministry of Road Transport and Highways website showed that Tesla has had its vehicles certified as being safe and roadworthy in India. The site states that these tests ensure that the vehicle matches the requirements of the Indian market in terms of emission and safety and road worthiness. The other day we also reported that Tesla is in talks with 3 Indian car part manufacturers. It might be connected to Tesla’s plans to launch in India.
The cars receiving the nod are likely to be Model 3 and Model Y variants, as per a Tesla fan club.
Gaining a foothold in the Indian market is not likely to be a cakewalk. Electric Vehicles only account for 1% of the nation’s annual car sales, as mentioned in a report in Bloomberg.
Besides that Tesla automobiles are very expensive. The average Indian customer might not be the target market for Tesla India. To make things even worse, charging infrastructure is still not in place. The move to electric has also been hampered by the lack of financing for companies that want to develop EVs.
But the biggest roadblock Tesla is likely to face is the tax regime & Indian Bureaucracy. Elon Musk had tweeted earlier that import duties in India are highest in the world. He said that India treats green energy vehicles in the same manner as petrol vehicles, which is not consistent with the country’s climate goals.
Musk’s call for duty cuts has found support in Hyundai MD SS Kim who backed Musk and said that the government’s reduction in duty would help them create demand and market. Volkswagen also supported Musk and said that the market for EVs has to be big enough for investments to come in and there shouldn’t be any barriers for that. A few weeks ago the Indian Government Rejects Tesla’s Appeal For Lower EV Import Duties.
A recent Reuters report stated that the government is considering cutting import duties to as low as 40 per cent