Finally, Tesla Comes to India!
Tesla will finally start taking bookings in India from next month. But what kept Tesla out of the country for so long? And why it has finally decided to enter the market?
The latest buzz is that pre-bookings for Tesla will begin in Jan 2021 and deliveries will begin by quarter-end!
But, the road to India has been very long.
It first set foot in India in 2016. At that time, stalwarts like Vijay Shekar Sharma (founder, PayTM), Mahesh Murthy (Venture Capitalist), Vishal Gondal (founder, GOQii), pre-booked their Tesla's.
But, Tesla pushed its plans.
Here's why:
Tesla's modus operandi in any country is to build factories from the sales proceeds of its vehicles. It also gives the company some comfort on demand. But, with high import duties in India, it wasn't possible to kick-start sales.
Additionally, the uniquely Indian problems kept Tesla off the road. Well, well. Need we say anything about Indian roads?
Plus, Tesla has features such as lane-centring, automatic lane change, and the ability to summon Tesla from a parking spot. Unless one only travels to posh places, are those features even relevant in India?
In 2016, India recorded a sales of only 450 electric cars. and it had only approx. 250-350 charging stations.
India was a market not ready for EV's yet and Tesla already had a lot on its plate to venture out on unchartered land.
Times have changed now.
Indian govt. has made several moves to promote EV.
GST rates on EV have been reduced from 12% to 5%.
Under a scheme for Faster Adoption and Manufacturing of Electric Vehicles (FAME) in India, the govt is giving incentives of ₹1,000 crores between 2019-22 to increase the charging infrastructure in the country.
It is also providing ₹8,596 crores towards demand incentives. An incentive amount of ₹ 1.5 lakh per vehicle (approx.) will be paid to the manufacturer of four-wheelers!
But there is a catch here.
Maximum price of the four-wheeler can be ₹15 lakh in the scheme. Guess Tesla won't benefit from the scheme as the price of each Tesla (Model 3) is estimated to be around ₹70 lakh.
Nothing has been done about the import duties either, as the govt. aims to make India a front-runner in EV manufacturing.
However, with govt's increased thrust to increase sales of Electric Vehicle and an aim to reach a 30% of all private car sales to be electric vehicles by 2030, the picture is surely getting brighter for Tesla.
And so, the company is now ready to spend on expansion.
Tesla has become profitable, it has a healthy cash flow and it is optimizing its productions costs.
There could not be a better time for Tesla to land on the Indian roads.
In fact, it is in talks with the Karnataka govt. to set up a factory in the state.
Tesla has surely captured the mind-share of Indian consumers, but can it capture market-share too?
Will it be able to overcome uniquely Indian problems, or will it meet a fate similar to Harley Davidson?
Only time will tell.
Until then...
ReadOn
Thousands of readers get our daily updates directly on WhatsApp! 👇 Join now!
By Yavantika Malani