According to sources, Tesla plans to start by importing and selling its Model 3 electric sedan in India.
New Delhi:
India is willing to offer incentives to ensure that the cost of production of Tesla Inc. is lower than that of China if the vehicle manufacturer agrees to manufacture its electric vehicles in the country, the Union minister told Reuters. Nitin Gadkari.
Gadkari’s launch comes weeks after billionaire Elon Musk’s Tesla registered a company in India in a step towards entry into the country, possibly as early as mid-2021. Sources familiar with the matter have said that Tesla plans to start by importing and selling its Model 3 electric sedan in India.
“Instead of bringing together (the cars) in India, they should manufacture all the product in the country by hiring local suppliers. Then we can give higher concessions,” Gadkari said in an interview, without giving details about what incentives are being offered. .
“The government will make sure that Tesla’s production cost will be the lowest compared to the world, even China, when they start making their cars in India. We will make sure,” he said.
India wants to boost local manufacturing of electric vehicles (EVs), batteries and other components to reduce costly imports and curb pollution in its major cities.
This comes amid a global race of vehicle manufacturers to start production of electric vehicles as countries work to reduce carbon emissions.
But India faces a major challenge in securing a production commitment from Tesla, which did not immediately respond to an email asking for feedback on its plans in the country.
India’s fledgling electric vehicle market accounted for only 5,000 out of a total of 2.4 million vehicles sold in the country last year as negligible cargo infrastructure and the high cost of electric vehicles deterred buyers .
In contrast, China, where Tesla already manufactures cars, sold 1.25 million new-energy passenger vehicles, including electric vehicles, in 2020 on total sales of 20 million and accounted for more than a third of sales. Tesla World Championships.
India also does not have a comprehensive eV policy like China, the world’s largest car market, which forces companies to invest in the sector.
Gadkari said that in addition to being a large market, India could be an export hub, especially with 80% of the components of lithium-ion batteries being manufactured locally right now.
“I think it’s a win-win situation for Tesla,” Gadkari said, adding that he also wanted to work with Tesla on building an ultra-high-speed hyperlope between Delhi and Bombay.
India is developing a production-related incentive scheme for automotive and automotive component manufacturers, as well as for the creation of advanced battery manufacturing units, but details have not yet been finalized.
Switching to cleaner energy sources and reducing vehicle pollution is seen as crucial for India to meet its Paris Agreement climate commitments.
India last year introduced tougher emission standards for vehicle manufacturers to adapt them to international standards. It is now studying tightening fuel efficiency standards from April 2022, which according to industry executives may force some automakers to add electric or hybrid vehicles to their portfolios.
Added by the COVID-19 pandemic, the industry says it needs more time to make the transition.
Gadkari said he was not directly responsible for making the decision on whether to lag behind, but he was confident that India would fulfill its Paris treaty commitments without interrupting economic growth.
“Development and the environment will go hand in hand. It will take some time, but we will soon reach the international international standards,” he said.