New Delhi: Tesla Plans to sell electric cars in India have stalled, abandoned the search for showroom space and reassigned some of its local team after failing to secure lower import taxes, three people familiar with the matter said.
The decision limits negotiations with government representatives to more than a year-long stalemate as Tesla sought to test first demand by selling electric vehicles (EVs) imported from manufacturing centers in the US and China at lower tariffs.
But the government is forcing Tesla to commit to manufacturing locally before lowering tariffs, which could run as high as 100% on imported vehicles. Tesla set a Feb. 1 deadline to see if its lobbying yields results, sources familiar with the company’s plans said. When the government did not grant concessions, Tesla blocked plans to import cars into India, sources said, adding that those who did not want to be named did so because the discussions were private.
For months, Tesla has been looking for real estate options to open showrooms and service centers in major cities of New Delhi, Mumbai and Bengaluru, but the plan is now on hold, two sources said. Tesla did not respond to an email seeking comment.
A government spokesman did not immediately respond to a request for comment.
As recently as January, Chief Executive Elon Musk He said Tesla was “still working with the government out of many challenges” in terms of sales in India.
But strong demand for Tesla vehicles elsewhere and barriers to import taxes prompted a change of strategy, sources said. Modi tried to attract producers through the “Make in India” campaign, but his transport minister, Nitin GadkariHe said in April that importing cars from China to India would not be a “good proposal” for Tesla.
But New Delhi won in January, when German luxury car maker Mercedes-Benz said it would begin assembling one of its electric cars in India. Tesla intended to gain an early foothold in India’s small but growing market for electric vehicles, now dominated by local automakers. Tata Motors. Tesla’s price tag of at least $ 40,000 will put it in the luxury segment of the Indian market, where sales are only a small fraction of the annual vehicle sales of around 3 million. Reuters