Tesla India Factory Plan
Tesla officials to discuss factory plan with Minister of Commerce of India soon

Tesla India factory to produce low cost electric vehicles

Tesla is set to hold high-level discussions with India’s commerce minister, Piyush Goyal, this month to explore plans for building a factory in India. The primary objective is to manufacture a new, budget-friendly electric vehicle aimed at the local market and potential exports. The new entry-level Tesla EV is expected to be priced at Rs. 20 lakhs (ex-showroom).

The proposed new Rs. 20 lakh electric vehicle would offer Indian consumers a more affordable alternative compared to the current lowest-priced Model 3 sedan which starts at $40,240 in the United States.

Earlier attempts by Tesla to reduce import taxes on its EVs imported to India faced roadblocks when the Indian government emphasised the need for local production commitments.

As part of its engagement with Indian government officials, Tesla aims to discuss the establishment of an EV supply chain and land allotment for the proposed factory. The move is expected to create new jobs and enhance India’s manufacturing capabilities.

The company’s long-term success depends on its ability to bring down the cost of EVs significantly. Tesla’s next-generation vehicle platform promises to reduce production costs by 50 percent, with the potential to introduce multiple models, including an automated “robotaxi.”

With India being the world’s third-largest auto market, the current adoption of electric vehicles stands at less than 2 percent. The introduction of a low cost Tesla specifically designed for Indian roads and conditions might accelerate the country’s transition to EVs.

Apart from introducing a low cost EV, Tesla needs to setup a huge fast charging network across the country to improve the charging infrastructure in India. The big reason behind low EV adoption rate is the electric vehicle ecosystem in our country.