Tesla Kicks Off Manufacturing Cars In Germany For India Export This Year

Revving up its India plans, electric car maker Tesla has reportedly commenced production of cars at its plant in Germany for export to India later this year. 

Sources told Reuters that the company has already begun the production of right-hand drive cars intended for the Indian market. “The right-hand drive cars which will be allocated to India, they have started building them,” a source reportedly said.

While the company produces Model Y at its unit near Berlin, there was no clarity on which model Tesla plans to ship to India. As per the report, the EV major generally relies on its Shanghai export hub for production of right-hand-drive vehicles but is looking to reduce its dependence on China. 

“Tesla already imports parts from India and is now looking at reducing sourcing from China and making India a bigger sourcing hub,” a source reportedly said. 

Meanwhile, the EV major’s India blueprint also includes separate investments in building a charging network across the country. 

This comes days after reports surfaced that a Tesla team was slated to visit India later this month to scout sites for its potential $2 Bn manufacturing unit in the country. As part of this, the team is expected to visit three states namely Tamil Nadu, Maharashtra and Gujarat for the site of the plant which will likely come up in two years.

Telangana too jumped into the fray as industries minister D Sridhar Babu said that local authorities were holding discussions with Tesla to woo the EV automaker to the state.

Meanwhile, DPIIT Secretary Rajesh Kumar Singh was quoted as saying by Bloomberg that the ball was now in Tesla’s court as the Centre had already cut import duty on EVs.

“We will help them out in terms of giving them the contacts at state level… There have been contacts made at that level with state governments and the central government. VinFast has already announced and we expect a few others,” Singh said as per Bloomberg.

Just last month, the central government unveiled a new policy under which it reduced import tax rates on certain EVs if their manufacturers invest at least $500 Mn in setting up a local plant and commence production within three years. Under this, companies can import up to 8,000 cars a year at lower tax rates.

Tesla has ramped up its India plans at a time when EV adoption is picking up pace in the country. Spurred by production-linked incentives (PLIs) and subsidies, the space has seen an uptick in sales, especially the two-wheeler EV segment.

As per government data, electric two-wheeler registrations in the country stood at record 1.36 Lakh in March this year with Ola Electric leading the charts.

Note: We at Inc42 take our ethics very seriously. More information about it can be found here.