NEW DELHI: Tesla does not want to produce cars in India, a federal minister said on Monday, while adding that Mercedes-Benz and Volkswagen are among the foreign carmakers eyeing India’s new electric vehicle policy.
Tesla has long wanted to sell in the world’s third-largest car market, but high tariffs, which its chief Elon Musk has said are among the steepest in the world, have been a deterrent.
India on Monday finalised an EV policy that significantly cuts import taxes for foreign automakers that pledge to invest in building EVs domestically. The policy, which has been in the works for a year, was originally designed to lure Tesla to set up manufacturing in the country.
Under the revamped scheme, companies will be allowed to import a limited number of electric cars at a lower import duty of 15% versus the current 70% duty if they commit to investing $486 million to build EVs in the country, the ministry of heavy industries said.
Tesla board explores new pay deal for CEO Elon Musk, FT reports
The companies will be required to set up manufacturing facility in India and commence operations within three years after getting approval and must meet certain local content requirements. Domestic players like Tata Motors and Mahindra & Mahindra have invested millions of dollars in local EV manufacturing, with more to come, and lobbied against duty cuts.
India’s EV sales, dominated by Tata Motors, accounted for just 2.5% of total car sales of 4.3 million in 2024, and the government wants to increase this to 30% by 2030.
Comments
Comments are closed for this article.