India is poised to offer incentives to make Tesla’s EVs cost less than China’s. To do this, the automaker must commit to producing electric vehicles in India. Indian Transport Minister Nitin Gadkari told Reuters about it.
Gadkari’s proposal came a few weeks after Tesla registered the company in India, taking the first step towards a possible entry into the Indian market in the middle of this year. Sources familiar with the matter said Tesla plans to start by importing Model 3 electric vehicles.
“Instead of assembling (cars) in India, they should manufacture them entirely in the country, hiring local suppliers. Then we can make big concessions, ”Gadkari quoted Reuters as saying.
“The government will make sure that Tesla’s production costs are the lowest compared to the rest of the world, even China, when they start producing their cars in India. We will ensure this, ”the minister assured.
India wants to stimulate local production of electric vehicles, batteries and other components to cut imports and reduce pollution in its major cities.
Note that 2.4 million vehicles were sold in India last year, of which only 5,000 were electric vehicles. Potential buyers are turned off by the small number of charging stations and the high cost of electric vehicles. By comparison, in China, where Tesla already makes EVs, 20 million vehicles were sold in 2020, including 1.25 million EVs. China accounts for over a third of Tesla’s global sales.
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