As part of his three-day state visit to the United States, Prime Minister Narendra Modi met with Tesla CEO Elon Musk, reviving talks on the electric vehicle (EV) giant’s much-awaited India entry. During the discussion, Modi invited Musk to ‘explore opportunities in India for investments in electric mobility and rapidly expanding commercial space sector’, read a statement from the press information bureau. Following the meeting, Modi tweeted that the conversation with Musk covered issues ‘ranging from energy to spirituality’, and while Musk termed the meeting “fantastic” and hinted at a “significant” future investment in the country, he steered clear of committing a time frame for Tesla’s India debut.
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“I'm confident that Tesla will be in India and will do so as soon as humanly possible. I'd like to thank the Prime Minister for his support and hopefully we'll be able to announce something in the not-too-distant future. We don't want to jump the gun on an announcement, but I think it's quite likely that there will be a significant investment and relationship with India in the future”, said Musk during a media scrum after the meeting, adding that he plans to visit India in 2024.
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In a separate interaction, Musk said he sees India holding “more promise” than any other large nation worldwide, and that Tesla is in the process of nailing down the “right timing” for its India entry.
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“I think India has more promise than any large country in the world. He [Modi] really cares about India because he is pushing us to make significant investments in India, which is something that we intend to do; we're just trying to figure out the right timing”, Musk said.
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Tesla has previously attempted to dip its toes into the Indian passenger vehicle market. It opened pre-orders for the Model 3 way back in 2016, but the EV was never delivered to customers. Tesla originally planned to enter the market by shipping its vehicles to India as full imports, and lobbied hard for import duties to be slashed to nil on EVs being imported into India.
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Tesla had previously planned to import its EVs into India, and lobbied hard for concessions on imports.
However, the Indian government stood firm and resisted any potential reduction in import duties, insisting that concessions will only be granted to those manufacturing electric vehicles – and associated components, including batteries – in India. As a result, Tesla dissolved its India team, and a delegation recently met with authorities in India to discuss the potential of setting up vehicle as well as battery manufacturing facilities in the country.
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Musk also spoke about how India holds immense potential for Tesla’s energy storage business, stating the country is “great” as a base for solar energy generation.
Tesla is now understood to be exploring setting up vehicle as well as battery manufacturing facilities in India.
“There's a tremendous amount of potential for all three pillars of the sustainable energy future [in India]. The three pillars being sustainable energy generation through solar and wind primarily, and obviously, India is great for solar. The amount of land area you actually need to generate enough electricity to power India is very small. I I believe it would be probably one or 2 per cent of the land area of India, so it's very doable. And then you need to pair that with stationary battery packs, because the sun doesn't shine at night, and then you need electric vehicles, and then you have a sustainable energy future. This is a lower cost way to go as well, that may surprise people”, Musk told the media.
Tesla’s current passenger vehicle portfolio comprises the Model 3, Model Y, Model S and Model X. The firm recently confirmed it will not manufacture the Model S and X in right-hand-drive form, so it is likely that if it makes its entry into India in the near future, it will have to do so with one of its more attainable models. Tesla also recently teased the silhouette of what could be its much-anticipated $25,000 entry-level hatchback, which could be a prime candidate for an India launch.
