Tesla Not Interested In Manufacturing In India, Says HD Kumaraswamy

Union Heavy Industries Minister H D Kumaraswamy on Monday said that Elon Musk-owned Tesla is not interested in manufacturing cars in India, but is interested in opening showrooms to sell its vehicles.

Tesla India Manufacturing Edited by
Tesla Not Interested In Manufacturing In India, Says HD Kumaraswamy

Tesla Not Interested In Manufacturing In India, Says HD Kumaraswamy (image:x.com/hd_kumaraswamy)

Union Heavy Industries Minister H D Kumaraswamy on Monday said that Elon Musk-owned Tesla is not interested in manufacturing cars in India, but is interested in opening showrooms to sell its vehicles.

Meanwhile, Kumaraswamy added that despite the lack of interest from Tesla, the global Electric Vehicle (EV) makers like Mercedes-Benz, Volkswagen-Škoda, Hyundai and Kia have shown interest to start manufacturing units based on the new policy for electric vehicles in India.

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“Tesla, we are not actually expected from them, they are only to start showrooms. They are not interested in manufacturing in India,” ANI quoted, Minister as saying.

The flagship Scheme by the Ministry of Heavy Industries (MHA) titled, Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI) was notified in March last year. The scheme aimed to attract investments from global EV manufacturers and promote India as a manufacturing destination for e-vehicles. The Ministry is  also planning to issue a notice inviting online applications soon.

As per the scheme, Approved applicants would be required to make minimum investment of Rs. 4,150 crore in India in consensus with the provisions of the scheme.

In turn, the approved applicants will be allowed to import Completely Built-in Units (CBUs) of e-4W of maximum of 8,000 numbers with a minimum CIF value of USD 35,000 at reduced customs duty of 15% for a period of 5 years. The scheme is limited to global EV manufacturers with a revenue of at least Rs 10,000 crore per year, with fixed assets valued at a minimum of Rs 3,000 crore.

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Reason Behind Tesla’s Withdrawal

For the past few years, the EV giant have been planning to setting up manufacturing and production units in India. Though Musk was planning to visit India and make a deal to invest over $2 billion into a car manufacturing facility in the country, the situations, especially tariff initiations in the US, has changed since Donald Trump came to power.

In February, Trump has said that Tesla’s plan to expand in India surpassing country’s tariffs would be “unfair” to the US. “Now, if (Tesla CEO Elon Musk) built the factory in India, that’s okay, but that’s unfair to us. It’s very unfair,” US President had said. In a similar vein, Trump has raised objections to Apple’s expansion plans in India.