Tesla in talks to set up EV factory in India, cars to start at Rs 20 lakh: Report

If all goes as planned, Indians may soon have the opportunity to purchase Tesla electric vehicles manufactured within the country. Elon Musk's renowned EV company, Tesla, is reportedly engaging in discussions with the Indian government to establish a factory for the production of EV cars in India.

• The EVs manufactured in the Indian factory would start selling at $24,400 or nearly Rs 20,00,000.
• The factory would have an annual capacity of making 5 lakh cars, according to a Times of India report.
• Reportedly, Tesla not only plans to make EV cars in India for the domestic market but also wants to use India as a base to supply cars in the Indo-pacific region.

A change of stance

So far, neither Tesla nor the Indian government has responded to the development. This report marks a change in stance for the American car marker, which was earlier at loggerheads with the Indian government on manufacturing and importing Tesla cars to the country.

• Just last year, talks between Tesla and the Indian government hit a roadblock after the latter refused to lower import taxes, which can be as high as 100%.
• While the Indian government insisted that Tesla made their cars locally, the American car maker wanted to first test the Indian market before investing in manufacturing.
• The change in stance also seems to be influenced by the larger trend in American companies seeking out manufacturing bases outside of China, mainly due to the uncertain policies in the country and the political friction between China and the US.
• Apple and its suppliers are also setting up their units in India in a bid to diversify their manufacturing bases.
• Currently, Tesla manufactures its cars in various locations from the US to Shanghai in China.

This year brought a new wave of interactions between Tesla and the Indian government. In May, senior Tesla executives reportedly met with Indian officials to discuss the expansion of the supply chain. The development also comes just a month after Tesla CEO Elon Musk met Prime Minister Narendra Modi during his US visit.

Musk had said that he is a fan of Modi. There are even plans to bring Starlink satellite internet to India.