Tesla in India is getting serious, yet again, after the government has reportedly discussed a roadmap report from the electric vehicle maker as negotiations for the company’s arrival in the country seem somewhat imminent.
Indian government officials have already asked Tesla if it is serious about setting up a manufacturing plant in the country, it is willing to “offer import concessions on the components required for the same,” the Financial Express reported.
Tesla will eventually have to manufacture the components locally, as it favors domestic manufacturing and will not necessarily be able to import vehicle components from China or other countries.
“The government is willing to give time for setting up a domestic vendor base, but Tesla will have to indicate a period by which the duty concessions on components granted to it will come to an end,” officials reportedly told the publication.
India did the same for Apple, and it seems Tesla is finally getting some movement on the terms it laid out for an Indian factory.
The two parties have been working on an agreement for years, but now it seems the game of chicken to see who would budge first is coming to a close.
India has long favored domestic manufacturing as part of its “Make in India” campaign, which has been geared toward boosting the country’s economy. Tesla, on the other hand, has pushed to test demand by importing vehicles from China, a strategy that does not align with “Make in India,” and government officials have not been keen on supporting.
But the terms are undoubtedly moving forward, especially as recent developments have shown Tesla is looking to move forward and is reportedly “serious” about building a manufacturing plant in India, according to Rajeev Chandrasekhar, India’s Minister of State for Skill Development and Entrepreneurship.
Tesla ‘serious’ about India factory, but what has changed remains unclear
Officials said a fixed timeline for localization is already set, and once Tesla agrees to build a plant, the government may come out with a modified production-linked incentive (PLI) scheme.
Tesla is also no longer pressing for lower import duties, so both sides are moving forward to make a deal happen.
CEO Elon Musk noted in May that the company will likely announce a new Gigafactory location by year’s end, and India is absolutely appealing for the potential site.
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