Import Tariffs Are Too High. Tesla Intends To Build A Battery Factory In India

- Oct 26, 2019-

According to foreign media reports, electric car manufacturer Tesla has not entered the Indian market, but the latest reports from the local media indicate that the company intends to build a battery factory in India.


As early as 2016, Tesla CEO Elon Musk said that Tesla had plans to enter the Indian market, but these plans were subsequently postponed. At the time, Tesla’s chief information officer, Jay Vijayan, who was born in India, personally traveled to India to investigate the possibility of Tesla starting to import cars in India.


After that, there was some confusion about Tesla's ability to even import its cars in India in 2016. At the time, Musk expressed concern that local Indian regulations forced foreign retailers to purchase 30% of parts locally, which could prevent the launch of the product.


But the Indian Ministry of Commerce and Industry has responded positively to Musk, who actually think Tesla will open a factory in India to sell cars in India, but like almost all markets outside the US, Tesla originally It is planned to import cars in India.


Earlier this month, Musk once again stated that Tesla's entry into the Indian market is a major challenge. He said: "I was told that import tariffs are very high (up to 100%), even electric cars. This will make our cars very expensive."


To enter the Indian market, foreign automakers need to have local factories in India to reduce the high import tariffs on foreign cars. Musk seems reluctant to establish a Tesla factory in India before they start importing cars, but he does say that there is a possibility to do so.


At the beginning of the month, Musk said: "For other countries, we pay part of the cost of building a local factory by selling cars locally in advance. At the same time, it gives a feeling of demand. India's current regulations prevent this, but the recent sales tax The changes have brought hope to our future change plans."


Tesla and other electric vehicle manufacturers and battery manufacturers have now expressed interest in participating in a government project to fund several battery factories in the country.


Local media in India reported that: "Tesla and China Contemporary Amp Technology Co., Ltd. (CATL) and other companies have shown initial interest in the Indian government's plan, the Indian government plans to invest in the construction of large factories to produce lithium-ion batteries."


According to reports, the Indian government's goal is to build six large factories, the annual output of lithium-ion batteries can reach several thousand megawatt hours, such as the "GigaFactory 1" in Tesla, Nevada, USA.


BYD is also said to be one of the companies interested in the project, but no one has commented on it.