In a bold declaration during a recent Fox News interview with Sean Hannity, US President Donald Trump stated that any plans for Tesla to open a manufacturing facility in India would be “very unfair” to America. His comment came just days after Tesla CEO Elon Musk met with Indian Prime Minister Narendra Modi during the latter’s US visit.
Trump argued that high tariffs imposed by foreign countries—India in particular—are designed to exploit the United States. “Every country in the world takes advantage of us, and they do it with tariffs. They make it practically impossible for him [Musk] to sell a car, as an example, in India,” Trump explained. He added that although a Tesla factory in India would be acceptable in principle, it would place American manufacturers at a disadvantage. “Now, if he built the factory in India, that’s okay, but that’s unfair to us. It’s very unfair,” he asserted.
Musk corroborated Trump’s point by noting that India levies a 100% import duty on automobiles, a policy that has long frustrated foreign manufacturers seeking entry into the country’s vast market. “The tariffs are like 100 percent,” Musk confirmed, underscoring the challenges Tesla has faced due to these steep duties.
Tariff Disparity on Motorcycles
A White House fact sheet reports that India charges a full 100% tariff on motorcycles imported from the United States, while the U.S. imposes only a 2.4% tariff on those from India.
Trump’s comments further revealed his intention to implement a policy of reciprocal tariffs. “I told Prime Minister Modi yesterday, ‘Here’s what we’re going to do: reciprocal. Whatever you charge, I’m charging.’” According to Trump, matching India’s tariffs on American products would help level the playing field—a stance he insists is indisputable. “Nobody can argue with me,” he declared.
The remarks come amid ongoing debates over international trade policies and highlight the complexities surrounding Tesla’s potential expansion in India. While Tesla has been eyeing the Indian market for years, the combination of high import tariffs and a nascent domestic electric vehicle sector has so far stalled any definitive move toward local production.
As discussions over trade fairness continue between the US and India, Trump’s tariff threats and the prospect of reciprocal measures could have far-reaching implications for bilateral economic relations. For Tesla and other American companies, the situation underscores a challenging landscape where government policies and international trade dynamics directly impact market entry and investment decisions.