• Wednesday, February 28, 2024
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Tesla to begin manufacturing of EVs in India after $2bn investment

Tesla’s shares drop 9% ahead of Twitter takeover

Tesla, a US electric car maker, is perfecting plans to make a $2 billion investment that would see the automaker manufacturing Electric Vehicles from India.

Though the plan is tied to the Indian government approving a concessional duty of 15 percent on its imported vehicles during the first two years.

Tesla has approached the Indian government with a detailed proposal, reflecting the link between the volume of investment to the number of cars it can import at lower duty.

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According to an Economic Times report, the company may be willing to invest up to $500 million, if India extends a concession on tariff for 12,000 cars and may increase the investment to $2 billion if the concession is applied for 30,000 cars.

Tesla also said that it may commit to localise up to 20 percent of the value of made-in-India cars in 2two years and increase that to 40 percent in four years.

Also, government officials are examining the proposal’s viability of the upper limit of $2 billion.

Also, government officials aware of the matter said that it is considering a reduction in the number of cars mentioned in the proposal for concession, and considering whether a concessional tariff can be imposed on 10 percent of the total EVs projected to be sold in India during this financial year and can be increased by 20 percent for the next fiscal.

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According to the government, around 50,000 EVs were sold in full year 23 which is expected to go up to 1,00,000 units by the end of full year 24.

Previously, the EV giant and the government were reported to be closing an agreement soon to start the operation of Tesla in India from 2024 onwards.

The final announcement on the deal is likely to be made at the upcoming Vibrant Gujarat Global Summit in January 2024.

It was gathered that the company will roll out Model Y crossover in India, as their first car model in the country.