Tesla to Discuss Manufacturing Strategy for Affordable Vehicle with Indian Government Official – Source
According to a reliable source, Tesla officials are scheduled to have a meeting with India’s commerce minister later this month. The purpose of the meeting is to discuss the company’s proposal of establishing a factory in India for manufacturing a brand-new car priced at $24,000.
Tesla has expressed interest in building a factory in India to make low-cost electric vehicles (EVs) for the local market and for export, the person said, adding that the company had indicated it would come for a new vehicle.
The talks are a sharp turnaround for the company after last year’s efforts to lower the import tax on electric cars shipped to India were thwarted by calls from government officials to commit to making cars locally.
The meeting with the commerce minister would be the highest-level discussion between Tesla and the Indian government since June, when Elon Musk met Indian Prime Minister Narendra Modi and said he planned to make a major investment in the country.
The 2 million rupee ($24,000) EV Tesla representatives were told when discussing a possible Indian plant would be 25% cheaper than its current cheapest offering, the Model 3 sedan, which sells for just over $32,200 in China.
Earlier this month, The Times of India newspaper reported a target price of $24,000 for the new Tesla vehicle.
Tesla did not immediately respond to a request for comment.
Electric vehicles currently account for less than 2% of total vehicle sales in India, now the world’s third largest auto market.
Reuters reported in May that Tesla executives visited India and held talks with officials about setting up a car and battery manufacturing plant in India.
Talks with Indian government officials in New Delhi are expected to resume this month, two people familiar with the talks, who asked not to be named because the discussions remain private, told Reuters.
As part of that, Tesla representatives are scheduled to meet India’s Commerce Minister Piyush Goyal, the first person said, and talks are expected to focus on setting up an electric vehicle supply chain and discussing allocating land for the factory.
The Ministry of Trade did not respond to a request for comment.
Tesla has been aggressively discounting its current models since the start of the year, while Musk has repeatedly said its long-term success depends on sharply lowering the cost of electric cars.
Tesla has said its next-generation vehicle platform will cut production costs by 50 percent and could be used to build multiple models — including an automated “robotaxis” — without detailing future models or their pricing.
The Tesla factory under construction in Mexico will make vehicles on this lower-cost, high-volume platform, which the company has said it will take to other factories as well.
Tesla currently manufactures electric cars in California and Texas. Outside of North America, it has factories in Berlin and Shanghai.
The Shanghai factory is Tesla’s largest, accounting for nearly 40 percent of the automaker’s global capacity. Plans for additional capacity are awaiting approval from the authorities.
