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Tesla will not make cars in India, only open showrooms. Union Minister HD Kumaraswamy said that Mercedes-Benz, Skoda-Volkswagen, Hyundai and Kiya have shown interest in EV construction in India.
Tesla cars will soon be available for sale in India.
Highlights
- Tesla will only open showrooms in India, will not build.
- Mercedes-Benz, Skoda-Volkswagen, Hyundai and Kiya showed interest in EV construction.
- The government is encouraging foreign companies to build EV in India.
New Delhi. Elon Musk’s electric vehicle manufacturer Tesla will not make cars in India yet. Giving this information on Monday, Union Heavy Industries Minister HD Kumaraswamy said that Tesla is only planning to open a showroom in India, while it is not interested in manufacturing. According to news agency PTI, Minister Kumaraswamy said, “Tesla is interested in starting the showroom instead of starting construction work in India. They are not excited about manufacturing.” It is worth noting that Tesla has started the process of certification and homeology to sell its EV in India and is expected to launch its first car in the market in the next two to three months.
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Kumaraswamy said that veteran auto companies like Mercedes-Benz, Skoda-Volkswagen, Hyundai and Kiya have shown interest regarding the construction of electric vehicle in India. These companies are participating in the ongoing conversation with the government under ‘Scheme to promote electric passenger car manufacturing in India’. The scheme was notified last year, but its detailed guidelines have been released recently.
What is the government’s plan?
Foreign companies are being invited to increase the manufacture of electric cars in India under the government’s new scheme. The scheme includes encouragement of local production, concession in import duty, and local job opportunities. Under the policy, companies can import up to 8,000 EVs annually at a much lower fee of 15 per cent. Provided that they invest at least ₹ 4,150 crore (about $ 500 million) to set up domestic production units within three years.
Tesla’s lack of interest in manufacturing may be a shock for the government, but the participation of Europe and Korea companies can help India make India a global hub of electric vehicle manufacturing. At the same time, Tesla is also struggling with many challenges. In the first quarter of 2025, the company recorded a 13 per cent decline in global vehicle delivery and a 71 per cent decline in net profit, which is the first annual delivery decline in more than a decade.
