Tesla boss Elon Musk has hinted at the possibility of setting up a new factory in India.
Following a recent visit to India by a team from Tesla, Musk said in an interview with the Wall Street Journal the electric car manufacturer will select a new factory location by the end of the year, and India could be an intriguing option for expansion.
When asked about the most exciting country for building a Tesla plant, Musk replied, “We did make an announcement that Mexico would be our next location outside the US.
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We’ll probably pick another location towards the end of this year.”
Regarding India as a potential contender, he responded with an emphatic “Absolutely.”
Musk’s comments, although not providing a definite commitment to India, have sparked speculation Tesla may be seriously considering the country as a market.
Musk has previously expressed his desire to introduce Tesla cars in India, despite acknowledging challenges and high import duties as obstacles.
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The recent visit by Tesla’s team further fueled these speculations, especially as the Indian government has expressed openness to attract the company.
Tesla had previously requested a reduction in import duties to test the Indian market.
Rajeev Chandrasekhar, the Minister of State for IT & Electronics, confirmed executives from Tesla had meetings with relevant government departments, during which they were encouraged to consider investments in India.
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He said: “We told them that India is now a trusted destination for all players in electronics and electric vehicles supply chains.”
Tesla conducted extensive market research on entering the Indian market approximately two years ago but decided not to pursue it last year due to the lack of special incentives from the government.
The company had sought concessions on import duties to introduce its cars directly in the country, but the government cited examples of other manufacturers, such as Mercedes-Benz, Tata Motors, and Mahindra & Mahindra, who produce electric vehicles locally.
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The government also had reservations about Tesla potentially importing cars from its China factory due to heightened tensions.
As it stands, India imposes a 100 percent duty on completely-built cars with a CIF value exceeding $40,000 and a 60 percent duty on those costing less than that amount.
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