Tesla CEO Elon Musk took to social networking website Twitter to say that the company has been in discussions with the Indian government about getting relief in import duties and other restrictions here.
Tesla CEO Elon Musk took to social networking website Twitter to say that the company has been discussing with the Indian government about getting relief in import duties and restrictions here. He said that such exemptions are required until Tesla sets up its own local factory in the Indian market. Musk tweeted about this as a response to a question asked by a Twitter user. The user had asked about when the company is planning to get its electric-powered Tesla cars in the Indian market. Elon Musk had posted this in response: “In discussions with the Government of India requesting temporary relief on import penalties/restrictions until a local factory is built.”
Meanwhile, earlier too, the Tesla supremo had tweeted information about the company’s plans in India. When the Tesla Model 3 was unveiled, we were on the list of countries where people were enabled to place pre-orders by paying $1000 for the new vehicle. In April 2016, Musk had confirmed that Tesla will set up an India-wide ‘Supercharger network’ for the upcoming Tesla Model 3 car owners. This year in February, Musk had tweeted saying Tesla was looking at a ‘summer’ 2017 launch in the Indian market. However, that does not look close in sight. In May 3017, when a user had asked Musk about the future of the company cars in the country, he had tweeted saying, “Maybe I’m misinformed, but I was told that 30 percent of parts must be locally sourced, and the supply doesn’t yet exist in India to support that.”
Later the Make in India handle had tweeted out to him saying that 30 per cent sourcing rule only applied to goods in retail trading and that after manufacturing in India, a foreign investor is permitted to sell in any manner: wholesale, retail, including e-commerce. The tweet also pointed out FDI rules in India allows wholesale of imported goods in India without any sourcing conditions.
Based on the tweet, the 30 per cent sourcing rule won’t apply to Tesla, if it starts manufacturing in India. The problem for Tesla’s Model cars would still be the 100 per cent plus import duties if the cars are imported as a whole from abroad. Tesla without any manufacturing unit in the country will also be subject to these. For Elon Musk and Tesla, the Indian market will not be an easy one. Setting up the network of Superchargers for the cars will be one part of the challenge. The other will be in setting up local manufacturing to overcome tax and import duty hurdles.
Recently when US President Donald Trump had pulled the country out of the Paris convention on climate change, Musk had also tweeted a link to an article about Indian government aiming for all electric vehicles by 2030.