Unsold Model Y stock and discounts signal Tesla’s slow India debut
Tesla is facing an early setback in its India entry, with a significant portion of its initial imported Model Y stock still unsold months after arrival. Around 100 units, or roughly one-third of an estimated 300 shipped SUVs, remain without buyers, according to people familiar with the situation.
To move inventory, Tesla has begun offering discounts of up to Rs. 2 lakh on selected Standard Range units, though these price reductions are being communicated directly to interested customers rather than through official nationwide promotional campaigns.
The slower-than-expected traction highlights the challenge of positioning a premium imported EV in a price-sensitive but growing market. Tesla began retail operations in July 2025, banking on brand recognition despite import duties that can push final prices to around $70,000 for the Model Y.
Early excitement translated into approximately 600 bookings, but a substantial share has not converted into completed deliveries, contributing to inventory build-up. Registration data further indicates limited market penetration, with only 227 Tesla vehicles recorded in India during 2025.
Some prospective buyers have reportedly backed out after test drives, citing alternatives that either cost less or offer more equipment at similar price points, including BMW’s locally assembled iX1 and BYD’s Sealion 7. Both models start below the Model Y’s price and are backed by established dealer networks. Tesla has also faced softening demand globally, with worldwide sales declining for a second straight year in 2025 and intensified competition from manufacturers in China, Europe and the US.
Tesla has made efforts to strengthen its local positioning, hiring former Lamborghini India executive Sharad Agarwal to lead operations and opening a retail space in Mumbai. However, limited visibility, high import duties and the absence of lower-cost or locally assembled options have slowed adoption. The company had evaluated entering India for nearly a decade before committing, following high-level discussions between CEO Elon Musk and government leaders.
Market trends suggest that competitors in similar segments are currently benefitting from more fitting strategies for India’s luxury EV landscape. BMW’s Indian sales rose nearly 200 percent in 2025, driven by local assembly and pricing advantages, while BYD expanded volumes by offering multiple models at varied price points through local partnerships.
Tesla’s India trajectory remains uncertain in the short term, particularly as global EV demand softens and domestic customers weigh pricing, range and feature sets differently from Tesla’s established Western markets.
